Correlation Between Converge Information and Apex Mining

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

By analyzing existing cross correlation between Converge Information Communications and Apex Mining Co, you can compare the effects of market volatilities on Converge Information and Apex Mining 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 Converge Information with a short position of Apex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Converge Information and Apex Mining.

Diversification Opportunities for Converge Information and Apex Mining

0.6

Correlation Coefficient

Converge Information  Apex Mining

Poor diversification

The 3 months correlation between Converge and Apex is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Converge Information Communica and Apex Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apex Mining and Converge Information 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 Converge Information Communications are associated (or correlated) with Apex Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apex Mining has no effect on the direction of Converge Information i.e., Converge Information and Apex Mining go up and down completely randomly.

Pair Corralation between Converge Information and Apex Mining

Assuming the 90 days trading horizon Converge Information Communications is expected to generate 0.63 times more return on investment than Apex Mining. However, Converge Information Communications is 1.59 times less risky than Apex Mining. It trades about -0.02 of its potential returns per unit of risk. Apex Mining Co is currently generating about -0.07 per unit of risk. If you would invest  1,892  in Converge Information Communications on April 20, 2025 and sell it today you would lose (86.00) from holding Converge Information Communications or give up 4.55% of portfolio value over 90 days.

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

Converge Information Communica  vs.  Apex Mining Co

Converge Information

Risk-Adjusted Performance

Very Weak

Over the last 90 days Converge Information Communications has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Converge Information is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Apex Mining

Risk-Adjusted Performance

Very Weak

Over the last 90 days Apex Mining Co 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 technical and fundamental indicators remain rather sound which may send shares a bit higher in August 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Converge Information and Apex Mining

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

The idea behind Converge Information Communications and Apex Mining Co 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.