Correlation Between Credo Technology and Computer Modelling

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

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

Diversification Opportunities for Credo Technology and Computer Modelling

-0.18

Correlation Coefficient

Credo Technology  Computer Modelling

Good diversification

The 3 months correlation between Credo and Computer is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Credo Technology Group and Computer Modelling Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Modelling and Credo Technology 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 Credo Technology Group are associated (or correlated) with Computer Modelling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Modelling has no effect on the direction of Credo Technology i.e., Credo Technology and Computer Modelling go up and down completely randomly.

Pair Corralation between Credo Technology and Computer Modelling

Given the investment horizon of 90 days Credo Technology Group is expected to generate 3.05 times more return on investment than Computer Modelling. However, Credo Technology is 3.05 times more volatile than Computer Modelling Group. It trades about -0.04 of its potential returns per unit of risk. Computer Modelling Group is currently generating about -0.2 per unit of risk. If you would invest  17,231  in Credo Technology Group on September 18, 2025 and sell it today you would lose (3,818) from holding Credo Technology Group or give up 22.16% of portfolio value over 90 days.

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

Credo Technology Group  vs.  Computer Modelling Group

Credo Technology

Risk-Adjusted Performance

Weakest

Over the last 90 days Credo Technology Group 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 fundamental indicators remain very healthy which may send shares a bit higher in January 2026. The recent disarray may also be a sign of long period up-swing for the firm investors.

Computer Modelling

Risk-Adjusted Performance

Weakest

Over the last 90 days Computer Modelling Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in January 2026. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Credo Technology and Computer Modelling

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

The idea behind Credo Technology Group and Computer Modelling 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.