Correlation Between 21st Century and Interactive Brokers

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Can any of the company-specific risk be diversified away by investing in both 21st Century and Interactive Brokers 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 21st Century and Interactive Brokers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 21st Century Management and Interactive Brokers Group, you can compare the effects of market volatilities on 21st Century and Interactive Brokers 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 21st Century with a short position of Interactive Brokers. Check out your portfolio center. Please also check ongoing floating volatility patterns of 21st Century and Interactive Brokers.

Diversification Opportunities for 21st Century and Interactive Brokers

-0.75
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between 21st and Interactive is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding 21st Century Management and Interactive Brokers Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Interactive Brokers and 21st Century 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 21st Century Management are associated (or correlated) with Interactive Brokers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Interactive Brokers has no effect on the direction of 21st Century i.e., 21st Century and Interactive Brokers go up and down completely randomly.

Pair Corralation between 21st Century and Interactive Brokers

Assuming the 90 days trading horizon 21st Century Management is expected to under-perform the Interactive Brokers. But the stock apears to be less risky and, when comparing its historical volatility, 21st Century Management is 1.89 times less risky than Interactive Brokers. The stock trades about -0.32 of its potential returns per unit of risk. The Interactive Brokers Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  6,356  in Interactive Brokers Group on August 16, 2025 and sell it today you would earn a total of  348.00  from holding Interactive Brokers Group or generate 5.48% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

21st Century Management  vs.  Interactive Brokers Group

 Performance 
       Timeline  
21st Century Management 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days 21st Century Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's primary indicators remain very healthy which may send shares a bit higher in December 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.
Interactive Brokers 

Risk-Adjusted Performance

Soft

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Interactive Brokers Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating forward-looking signals, Interactive Brokers may actually be approaching a critical reversion point that can send shares even higher in December 2025.

21st Century and Interactive Brokers Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with 21st Century and Interactive Brokers

The main advantage of trading using opposite 21st Century and Interactive Brokers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 21st Century position performs unexpectedly, Interactive Brokers 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 Interactive Brokers will offset losses from the drop in Interactive Brokers' long position.
The idea behind 21st Century Management and Interactive Brokers 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.

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