Correlation Between Cognyte Software and Evertec

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

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

Diversification Opportunities for Cognyte Software and Evertec

0.67

Correlation Coefficient

Cognyte Software  Evertec

Poor diversification

The 3 months correlation between Cognyte and Evertec is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Cognyte Software and Evertec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evertec and Cognyte Software 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 Cognyte Software are associated (or correlated) with Evertec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evertec has no effect on the direction of Cognyte Software i.e., Cognyte Software and Evertec go up and down completely randomly.

Pair Corralation between Cognyte Software and Evertec

Given the investment horizon of 90 days Cognyte Software is expected to generate 1.53 times more return on investment than Evertec. However, Cognyte Software is 1.53 times more volatile than Evertec. It trades about -0.04 of its potential returns per unit of risk. Evertec is currently generating about -0.19 per unit of risk. If you would invest  902.00  in Cognyte Software on August 5, 2025 and sell it today you would lose (67.00) from holding Cognyte Software or give up 7.43% of portfolio value over 90 days.

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

Cognyte Software  vs.  Evertec

Cognyte Software

Risk-Adjusted Performance

Weakest

Over the last 90 days Cognyte Software has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cognyte Software is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Evertec

Risk-Adjusted Performance

Weakest

Over the last 90 days Evertec has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in December 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Cognyte Software and Evertec

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

The idea behind Cognyte Software and Evertec 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.