Correlation Between DSS and Cass Information

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

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

Diversification Opportunities for DSS and Cass Information

-0.44

Correlation Coefficient

DSS  Cass Information

Very good diversification

The 3 months correlation between DSS and Cass is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding DSS Inc and Cass Information Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cass Information Systems and DSS 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 DSS Inc are associated (or correlated) with Cass Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cass Information Systems has no effect on the direction of DSS i.e., DSS and Cass Information go up and down completely randomly.

Pair Corralation between DSS and Cass Information

Considering the 90-day investment horizon DSS Inc is expected to generate 3.3 times more return on investment than Cass Information. However, DSS is 3.3 times more volatile than Cass Information Systems. It trades about 0.04 of its potential returns per unit of risk. Cass Information Systems is currently generating about -0.03 per unit of risk. If you would invest  100.00  in DSS Inc on May 5, 2025 and sell it today you would earn a total of  6.00  from holding DSS Inc or generate 6.0% return on investment over 90 days.

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

DSS Inc  vs.  Cass Information Systems

DSS Inc

Risk-Adjusted Performance

Insignificant

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

Cass Information Systems

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cass Information Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cass Information is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with DSS and Cass Information

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

The idea behind DSS Inc and Cass Information Systems 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..