Correlation Between Converge Information and Top Frontier

Can any of the company-specific risk be diversified away by investing in both Converge Information and Top Frontier 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 Top Frontier 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 Top Frontier Investment, you can compare the effects of market volatilities on Converge Information and Top Frontier 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 Top Frontier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Converge Information and Top Frontier.

Diversification Opportunities for Converge Information and Top Frontier

-0.57

Correlation Coefficient

Converge Information  Top Frontier

Excellent diversification

The 3 months correlation between Converge and Top is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Converge Information Communica and Top Frontier Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Top Frontier Investment 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 Top Frontier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Top Frontier Investment has no effect on the direction of Converge Information i.e., Converge Information and Top Frontier go up and down completely randomly.

Pair Corralation between Converge Information and Top Frontier

Assuming the 90 days trading horizon Converge Information Communications is expected to generate 0.6 times more return on investment than Top Frontier. However, Converge Information Communications is 1.67 times less risky than Top Frontier. It trades about 0.07 of its potential returns per unit of risk. Top Frontier Investment is currently generating about -0.02 per unit of risk. If you would invest  1,029  in Converge Information Communications on March 29, 2025 and sell it today you would earn a total of  947.00  from holding Converge Information Communications or generate 92.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	90.81%
Values	Daily Returns

Converge Information Communica  vs.  Top Frontier Investment

Converge Information

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Converge Information Communications are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Converge Information may actually be approaching a critical reversion point that can send shares even higher in July 2025.

Top Frontier Investment

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Converge Information and Top Frontier

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

The idea behind Converge Information Communications and Top Frontier Investment 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.