Correlation Between Mistras and CBIZ

Can any of the company-specific risk be diversified away by investing in both Mistras and CBIZ at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Mistras and CBIZ into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Mistras Group and CBIZ Inc, you can compare the effects of market volatilities on Mistras and CBIZ and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Mistras with a short position of CBIZ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mistras and CBIZ.

Diversification Opportunities for Mistras and CBIZ

0.08

Correlation Coefficient

Mistras  CBIZ

Significant diversification

The 3 months correlation between Mistras and CBIZ is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Mistras Group and CBIZ Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBIZ Inc and Mistras is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Mistras Group are associated (or correlated) with CBIZ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBIZ Inc has no effect on the direction of Mistras i.e., Mistras and CBIZ go up and down completely randomly.

Pair Corralation between Mistras and CBIZ

Allowing for the 90-day total investment horizon Mistras Group is expected to under-perform the CBIZ. In addition to that, Mistras is 1.68 times more volatile than CBIZ Inc. It trades about -0.24 of its total potential returns per unit of risk. CBIZ Inc is currently generating about -0.18 per unit of volatility. If you would invest  7,700  in CBIZ Inc on March 11, 2024 and sell it today you would lose (321.00) from holding CBIZ Inc or give up 4.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Mistras Group  vs.  CBIZ Inc

Mistras Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mistras Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Mistras is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

CBIZ Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CBIZ Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental drivers, CBIZ is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Mistras and CBIZ

The main advantage of trading using opposite Mistras and CBIZ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mistras position performs unexpectedly, CBIZ can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in CBIZ will offset losses from the drop in CBIZ's long position.

The idea behind Mistras Group and CBIZ Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Money Managers module to screen money managers from public funds and ETFs managed around the world.