Correlation Between Newtek Business and Coda Octopus

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

By analyzing existing cross correlation between Newtek Business Services and Coda Octopus Group, you can compare the effects of market volatilities on Newtek Business and Coda Octopus 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 Newtek Business with a short position of Coda Octopus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newtek Business and Coda Octopus.

Diversification Opportunities for Newtek Business and Coda Octopus

0.16

Correlation Coefficient

Newtek Business  Coda Octopus

Average diversification

The 3 months correlation between Newtek and Coda is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Newtek Business Services and Coda Octopus Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coda Octopus Group and Newtek Business 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 Newtek Business Services are associated (or correlated) with Coda Octopus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coda Octopus Group has no effect on the direction of Newtek Business i.e., Newtek Business and Coda Octopus go up and down completely randomly.

Pair Corralation between Newtek Business and Coda Octopus

Assuming the 90 days horizon Newtek Business is expected to generate 5.29 times less return on investment than Coda Octopus. But when comparing it to its historical volatility, Newtek Business Services is 19.35 times less risky than Coda Octopus. It trades about 0.18 of its potential returns per unit of risk. Coda Octopus Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  796.00  in Coda Octopus Group on July 8, 2025 and sell it today you would earn a total of  58.00  from holding Coda Octopus Group or generate 7.29% return on investment over 90 days.

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

Newtek Business Services  vs.  Coda Octopus Group

Newtek Business Services

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Newtek Business Services are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Newtek Business is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Coda Octopus Group

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Coda Octopus Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady fundamental indicators, Coda Octopus may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Pair Trading with Newtek Business and Coda Octopus

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

The idea behind Newtek Business Services and Coda Octopus Group 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 Anywhere module to track or share privately all of your investments from the convenience of any device.