Correlation Between Salzer Electronics and Computer Age

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

By analyzing existing cross correlation between Salzer Electronics Limited and Computer Age Management, you can compare the effects of market volatilities on Salzer Electronics and Computer Age 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 Salzer Electronics with a short position of Computer Age. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salzer Electronics and Computer Age.

Diversification Opportunities for Salzer Electronics and Computer Age

-0.46

Correlation Coefficient

Salzer Electronics  Computer Age

Very good diversification

The 3 months correlation between Salzer and Computer is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Salzer Electronics Limited and Computer Age Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Age Management and Salzer Electronics 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 Salzer Electronics Limited are associated (or correlated) with Computer Age. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Age Management has no effect on the direction of Salzer Electronics i.e., Salzer Electronics and Computer Age go up and down completely randomly.

Pair Corralation between Salzer Electronics and Computer Age

Assuming the 90 days trading horizon Salzer Electronics Limited is expected to under-perform the Computer Age. In addition to that, Salzer Electronics is 1.43 times more volatile than Computer Age Management. It trades about -0.11 of its total potential returns per unit of risk. Computer Age Management is currently generating about 0.04 per unit of volatility. If you would invest  408,312  in Computer Age Management on April 23, 2025 and sell it today you would earn a total of  16,438  from holding Computer Age Management or generate 4.03% return on investment over 90 days.

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

Salzer Electronics Limited  vs.  Computer Age Management

Salzer Electronics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Salzer Electronics Limited 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 essential 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.

Computer Age Management

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Computer Age Management are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Computer Age is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Salzer Electronics and Computer Age

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

The idea behind Salzer Electronics Limited and Computer Age Management 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 CEOs Directory module to screen CEOs from public companies around the world.