Correlation Between Bentley Systems and Agilysys

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

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

Diversification Opportunities for Bentley Systems and Agilysys

0.38

Correlation Coefficient

Bentley Systems  Agilysys

Weak diversification

The 3 months correlation between Bentley and Agilysys is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Bentley Systems and Agilysys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agilysys and Bentley 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 Bentley Systems are associated (or correlated) with Agilysys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agilysys has no effect on the direction of Bentley Systems i.e., Bentley Systems and Agilysys go up and down completely randomly.

Pair Corralation between Bentley Systems and Agilysys

Considering the 90-day investment horizon Bentley Systems is expected to under-perform the Agilysys. But the stock apears to be less risky and, when comparing its historical volatility, Bentley Systems is 2.57 times less risky than Agilysys. The stock trades about -0.12 of its potential returns per unit of risk. The Agilysys is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  11,490  in Agilysys on August 12, 2024 and sell it today you would earn a total of  391.00  from holding Agilysys or generate 3.4% return on investment over 90 days.

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

Bentley Systems  vs.  Agilysys

Bentley Systems

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bentley Systems are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Bentley Systems is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Agilysys

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Agilysys are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Agilysys may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Bentley Systems and Agilysys

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

The idea behind Bentley Systems and Agilysys 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.