Correlation Between Geospace Technologies and TGS NOPEC

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

By analyzing existing cross correlation between Geospace Technologies and TGS NOPEC Geophysical, you can compare the effects of market volatilities on Geospace Technologies and TGS NOPEC 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 TGS NOPEC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geospace Technologies and TGS NOPEC.

Diversification Opportunities for Geospace Technologies and TGS NOPEC

-0.03

Correlation Coefficient

Geospace Technologies  TGS NOPEC

Good diversification

The 3 months correlation between Geospace and TGS is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Geospace Technologies and TGS NOPEC Geophysical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TGS NOPEC Geophysical 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 TGS NOPEC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TGS NOPEC Geophysical has no effect on the direction of Geospace Technologies i.e., Geospace Technologies and TGS NOPEC go up and down completely randomly.

Pair Corralation between Geospace Technologies and TGS NOPEC

Given the investment horizon of 90 days Geospace Technologies is expected to generate 3.45 times more return on investment than TGS NOPEC. However, Geospace Technologies is 3.45 times more volatile than TGS NOPEC Geophysical. It trades about 0.17 of its potential returns per unit of risk. TGS NOPEC Geophysical is currently generating about -0.04 per unit of risk. If you would invest  614.00  in Geospace Technologies on May 14, 2025 and sell it today you would earn a total of  823.00  from holding Geospace Technologies or generate 134.04% return on investment over 90 days.

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

Geospace Technologies  vs.  TGS NOPEC Geophysical

Geospace Technologies

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Geospace Technologies are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Geospace Technologies unveiled solid returns over the last few months and may actually be approaching a breakup point.

TGS NOPEC Geophysical

Risk-Adjusted Performance

Weakest

Over the last 90 days TGS NOPEC Geophysical has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Geospace Technologies and TGS NOPEC

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

The idea behind Geospace Technologies and TGS NOPEC Geophysical 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 .