Correlation Between Newgen Software and Oracle Financial

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

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

Diversification Opportunities for Newgen Software and Oracle Financial

0.44

Correlation Coefficient

Newgen Software  Oracle Financial

Very weak diversification

The 3 months correlation between Newgen and Oracle is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Newgen Software Technologies and Oracle Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oracle Financial Services and Newgen 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 Newgen Software Technologies are associated (or correlated) with Oracle Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oracle Financial Services has no effect on the direction of Newgen Software i.e., Newgen Software and Oracle Financial go up and down completely randomly.

Pair Corralation between Newgen Software and Oracle Financial

Assuming the 90 days trading horizon Newgen Software is expected to generate 2.22 times less return on investment than Oracle Financial. In addition to that, Newgen Software is 1.67 times more volatile than Oracle Financial Services. It trades about 0.02 of its total potential returns per unit of risk. Oracle Financial Services is currently generating about 0.09 per unit of volatility. If you would invest  789,412  in Oracle Financial Services on April 20, 2025 and sell it today you would earn a total of  89,638  from holding Oracle Financial Services or generate 11.36% return on investment over 90 days.

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

Newgen Software Technologies  vs.  Oracle Financial Services

Newgen Software Tech

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Newgen Software Technologies are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong technical and fundamental indicators, Newgen Software is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Oracle Financial Services

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Oracle Financial Services are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Oracle Financial may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Newgen Software and Oracle Financial

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

The idea behind Newgen Software Technologies and Oracle Financial Services 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.

Check out your portfolio center.

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 CEOs Directory module to screen CEOs from public companies around the world.