Correlation Between Dataproces Group and CBrain AS

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

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

Diversification Opportunities for Dataproces Group and CBrain AS

-0.49

Correlation Coefficient

Dataproces Group  CBrain AS

Very good diversification

The 3 months correlation between Dataproces and CBrain is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Dataproces Group AS and cBrain AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on cBrain AS and Dataproces Group 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 Dataproces Group AS are associated (or correlated) with CBrain AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of cBrain AS has no effect on the direction of Dataproces Group i.e., Dataproces Group and CBrain AS go up and down completely randomly.

Pair Corralation between Dataproces Group and CBrain AS

Assuming the 90 days trading horizon Dataproces Group AS is expected to under-perform the CBrain AS. But the stock apears to be less risky and, when comparing its historical volatility, Dataproces Group AS is 1.07 times less risky than CBrain AS. The stock trades about -0.06 of its potential returns per unit of risk. The cBrain AS is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  16,560  in cBrain AS on April 25, 2025 and sell it today you would earn a total of  4,490  from holding cBrain AS or generate 27.11% return on investment over 90 days.

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

Dataproces Group AS  vs.  cBrain AS

Dataproces Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dataproces Group AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in August 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

cBrain AS

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in cBrain AS are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, CBrain AS sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Dataproces Group and CBrain AS

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

The idea behind Dataproces Group AS and cBrain AS 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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.