Correlation Between Geospace Technologies and CWC Energy

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

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

Diversification Opportunities for Geospace Technologies and CWC Energy

0.0

Correlation Coefficient

Geospace Technologies  CWC Energy

Pay attention - limited upside

The 3 months correlation between Geospace and CWC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Geospace Technologies and CWC Energy Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CWC Energy Services and Geospace Technologies 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 Geospace Technologies are associated (or correlated) with CWC Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CWC Energy Services has no effect on the direction of Geospace Technologies i.e., Geospace Technologies and CWC Energy go up and down completely randomly.

Pair Corralation between Geospace Technologies and CWC Energy

If you would invest  742.00  in Geospace Technologies on January 30, 2025 and sell it today you would lose (98.00) from holding Geospace Technologies or give up 13.21% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Geospace Technologies  vs.  CWC Energy Services

Geospace Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Geospace Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in May 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

CWC Energy Services

Risk-Adjusted Performance

Very Weak

Over the last 90 days CWC Energy Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, CWC Energy is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Geospace Technologies and CWC Energy

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

The idea behind Geospace Technologies and CWC Energy Services 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.