Correlation Between Made Tech and Shotspotter
Can any of the company-specific risk be diversified away by investing in both Made Tech and Shotspotter 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 Made Tech and Shotspotter into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Made Tech Group and Shotspotter, you can compare the effects of market volatilities on Made Tech and Shotspotter 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 Made Tech with a short position of Shotspotter. Check out your portfolio center. Please also check ongoing floating volatility patterns of Made Tech and Shotspotter.
Diversification Opportunities for Made Tech and Shotspotter
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Made and Shotspotter is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Made Tech Group and Shotspotter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shotspotter and Made Tech 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 Made Tech Group are associated (or correlated) with Shotspotter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shotspotter has no effect on the direction of Made Tech i.e., Made Tech and Shotspotter go up and down completely randomly.
Pair Corralation between Made Tech and Shotspotter
Assuming the 90 days trading horizon Made Tech Group is expected to generate 0.72 times more return on investment than Shotspotter. However, Made Tech Group is 1.39 times less risky than Shotspotter. It trades about -0.16 of its potential returns per unit of risk. Shotspotter is currently generating about -0.26 per unit of risk. If you would invest 3,775 in Made Tech Group on September 1, 2025 and sell it today you would lose (975.00) from holding Made Tech Group or give up 25.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 96.97% |
| Values | Daily Returns |
Made Tech Group vs. Shotspotter
Performance |
| Timeline |
| Made Tech Group |
| Shotspotter |
Made Tech and Shotspotter Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Made Tech and Shotspotter
The main advantage of trading using opposite Made Tech and Shotspotter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Made Tech position performs unexpectedly, Shotspotter 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 Shotspotter will offset losses from the drop in Shotspotter's long position.| Made Tech vs. Inspiration Healthcare Group | Made Tech vs. Charter Communications Cl | Made Tech vs. Primary Health Properties | Made Tech vs. Gamma Communications PLC |
| Shotspotter vs. Catalyst Metals Limited | Shotspotter vs. Rexford Industrial Realty | Shotspotter vs. Playtika Holding Corp | Shotspotter vs. Interplay Entertainment Corp |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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