Correlation Between Infrared Cameras and Gen Digital

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

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

Diversification Opportunities for Infrared Cameras and Gen Digital

0.72

Correlation Coefficient

Infrared Cameras  Gen Digital

Poor diversification

The 3 months correlation between Infrared and Gen is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Infrared Cameras Holdings and Gen Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gen Digital and Infrared Cameras 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 Infrared Cameras Holdings are associated (or correlated) with Gen Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gen Digital has no effect on the direction of Infrared Cameras i.e., Infrared Cameras and Gen Digital go up and down completely randomly.

Pair Corralation between Infrared Cameras and Gen Digital

Given the investment horizon of 90 days Infrared Cameras Holdings is expected to under-perform the Gen Digital. In addition to that, Infrared Cameras is 3.37 times more volatile than Gen Digital. It trades about -0.05 of its total potential returns per unit of risk. Gen Digital is currently generating about -0.13 per unit of volatility. If you would invest  3,040  in Gen Digital on July 22, 2025 and sell it today you would lose (370.00) from holding Gen Digital or give up 12.17% of portfolio value over 90 days.

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

Infrared Cameras Holdings  vs.  Gen Digital

Infrared Cameras Holdings

Risk-Adjusted Performance

Weakest

Over the last 90 days Infrared Cameras Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in November 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Gen Digital

Risk-Adjusted Performance

Weakest

Over the last 90 days Gen Digital 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 healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Infrared Cameras and Gen Digital

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

The idea behind Infrared Cameras Holdings and Gen Digital 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.