Correlation Between VerifyMe and Ciena Corp
Can any of the company-specific risk be diversified away by investing in both VerifyMe and Ciena Corp 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 VerifyMe and Ciena Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VerifyMe and Ciena Corp, you can compare the effects of market volatilities on VerifyMe and Ciena Corp 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 VerifyMe with a short position of Ciena Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of VerifyMe and Ciena Corp.
Diversification Opportunities for VerifyMe and Ciena Corp
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between VerifyMe and Ciena is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding VerifyMe and Ciena Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ciena Corp and VerifyMe 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 VerifyMe are associated (or correlated) with Ciena Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ciena Corp has no effect on the direction of VerifyMe i.e., VerifyMe and Ciena Corp go up and down completely randomly.
Pair Corralation between VerifyMe and Ciena Corp
Given the investment horizon of 90 days VerifyMe is expected to generate 4.89 times more return on investment than Ciena Corp. However, VerifyMe is 4.89 times more volatile than Ciena Corp. It trades about 0.04 of its potential returns per unit of risk. Ciena Corp is currently generating about 0.08 per unit of risk. If you would invest 165.00 in VerifyMe on February 8, 2024 and sell it today you would earn a total of 0.00 from holding VerifyMe or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
VerifyMe vs. Ciena Corp
Performance |
Timeline |
VerifyMe |
Ciena Corp |
VerifyMe and Ciena Corp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with VerifyMe and Ciena Corp
The main advantage of trading using opposite VerifyMe and Ciena Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VerifyMe position performs unexpectedly, Ciena Corp 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 Ciena Corp will offset losses from the drop in Ciena Corp's long position.VerifyMe vs. Oblong Inc | VerifyMe vs. Wilhelmina | VerifyMe vs. SilverSun Technologies | VerifyMe vs. Usio Inc |
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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