Correlation Between Brady and Iveda Solutions

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

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

Diversification Opportunities for Brady and Iveda Solutions

0.17

Correlation Coefficient

Brady  Iveda Solutions

Average diversification

The 3 months correlation between Brady and Iveda is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Brady and Iveda Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iveda Solutions and Brady 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 Brady are associated (or correlated) with Iveda Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iveda Solutions has no effect on the direction of Brady i.e., Brady and Iveda Solutions go up and down completely randomly.

Pair Corralation between Brady and Iveda Solutions

Considering the 90-day investment horizon Brady is expected to generate 0.25 times more return on investment than Iveda Solutions. However, Brady is 4.07 times less risky than Iveda Solutions. It trades about -0.01 of its potential returns per unit of risk. Iveda Solutions is currently generating about -0.02 per unit of risk. If you would invest  7,137  in Brady on May 5, 2025 and sell it today you would lose (110.00) from holding Brady or give up 1.54% of portfolio value over 90 days.

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

Brady  vs.  Iveda Solutions

Brady

Risk-Adjusted Performance

Very Weak

Over the last 90 days Brady has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Brady is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Iveda Solutions

Risk-Adjusted Performance

Very Weak

Over the last 90 days Iveda Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, Iveda Solutions is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Brady and Iveda Solutions

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

The idea behind Brady and Iveda Solutions 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .