Correlation Between Perficient and Concentrix

Can any of the company-specific risk be diversified away by investing in both Perficient and Concentrix 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 Perficient and Concentrix into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Perficient and Concentrix, you can compare the effects of market volatilities on Perficient and Concentrix 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 Perficient with a short position of Concentrix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perficient and Concentrix.

Diversification Opportunities for Perficient and Concentrix

0.66

Correlation Coefficient

Perficient  Concentrix

Poor diversification

The 3 months correlation between Perficient and Concentrix is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Perficient and Concentrix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concentrix and Perficient 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 Perficient are associated (or correlated) with Concentrix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concentrix has no effect on the direction of Perficient i.e., Perficient and Concentrix go up and down completely randomly.

Pair Corralation between Perficient and Concentrix

Given the investment horizon of 90 days Perficient is expected to generate 1.57 times more return on investment than Concentrix. However, Perficient is 1.57 times more volatile than Concentrix. It trades about 0.0 of its potential returns per unit of risk. Concentrix is currently generating about -0.06 per unit of risk. If you would invest  9,791  in Perficient on February 17, 2024 and sell it today you would lose (2,415) from holding Perficient or give up 24.67% of portfolio value over 90 days.

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

Perficient  vs.  Concentrix

Perficient

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Perficient are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating technical and fundamental indicators, Perficient unveiled solid returns over the last few months and may actually be approaching a breakup point.

Concentrix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Concentrix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in June 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Perficient and Concentrix

The main advantage of trading using opposite Perficient and Concentrix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perficient position performs unexpectedly, Concentrix 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 Concentrix will offset losses from the drop in Concentrix's long position.

The idea behind Perficient and Concentrix 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.

Check out your portfolio center.

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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.