Correlation Between ReposiTrak and Data IO

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

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

Diversification Opportunities for ReposiTrak and Data IO

-0.33

Correlation Coefficient

ReposiTrak  Data IO

Very good diversification

The 3 months correlation between ReposiTrak and Data is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding ReposiTrak and Data IO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data IO and ReposiTrak 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 ReposiTrak are associated (or correlated) with Data IO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data IO has no effect on the direction of ReposiTrak i.e., ReposiTrak and Data IO go up and down completely randomly.

Pair Corralation between ReposiTrak and Data IO

Given the investment horizon of 90 days ReposiTrak is expected to under-perform the Data IO. But the stock apears to be less risky and, when comparing its historical volatility, ReposiTrak is 1.34 times less risky than Data IO. The stock trades about -0.13 of its potential returns per unit of risk. The Data IO is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest  211.00  in Data IO on April 24, 2025 and sell it today you would earn a total of  107.00  from holding Data IO or generate 50.71% return on investment over 90 days.

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

ReposiTrak  vs.  Data IO

ReposiTrak

Risk-Adjusted Performance

Very Weak

Over the last 90 days ReposiTrak has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in August 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Data IO

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Data IO are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of very weak forward indicators, Data IO displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ReposiTrak and Data IO

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

The idea behind ReposiTrak and Data IO 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.