Correlation Between EPAM Systems and FRONTEO
Can any of the company-specific risk be diversified away by investing in both EPAM Systems and FRONTEO 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 EPAM Systems and FRONTEO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EPAM Systems and FRONTEO, you can compare the effects of market volatilities on EPAM Systems and FRONTEO 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 EPAM Systems with a short position of FRONTEO. Check out your portfolio center. Please also check ongoing floating volatility patterns of EPAM Systems and FRONTEO.
Diversification Opportunities for EPAM Systems and FRONTEO
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EPAM and FRONTEO is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding EPAM Systems and FRONTEO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FRONTEO and EPAM Systems 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 EPAM Systems are associated (or correlated) with FRONTEO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FRONTEO has no effect on the direction of EPAM Systems i.e., EPAM Systems and FRONTEO go up and down completely randomly.
Pair Corralation between EPAM Systems and FRONTEO
If you would invest 23,090 in EPAM Systems on January 24, 2024 and sell it today you would earn a total of 1,605 from holding EPAM Systems or generate 6.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
EPAM Systems vs. FRONTEO
Performance |
| Timeline |
| EPAM Systems |
| FRONTEO |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
EPAM Systems and FRONTEO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EPAM Systems and FRONTEO
The main advantage of trading using opposite EPAM Systems and FRONTEO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EPAM Systems position performs unexpectedly, FRONTEO 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 FRONTEO will offset losses from the drop in FRONTEO's long position.| EPAM Systems vs. FiscalNote Holdings | EPAM Systems vs. Innodata | EPAM Systems vs. Aurora Innovation | EPAM Systems vs. Conduent |
| FRONTEO vs. Omni Health | FRONTEO vs. Cumberland Pharmaceuticals | FRONTEO vs. enVVeno Medical Corp | FRONTEO vs. Integrated Media Technology |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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