Correlation Between Cloudpoint Technology and CPE Technology
Can any of the company-specific risk be diversified away by investing in both Cloudpoint Technology and CPE Technology 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 Cloudpoint Technology and CPE Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cloudpoint Technology Berhad and CPE Technology Berhad, you can compare the effects of market volatilities on Cloudpoint Technology and CPE Technology 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 Cloudpoint Technology with a short position of CPE Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cloudpoint Technology and CPE Technology.
Diversification Opportunities for Cloudpoint Technology and CPE Technology
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cloudpoint and CPE is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Cloudpoint Technology Berhad and CPE Technology Berhad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CPE Technology Berhad and Cloudpoint Technology 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 Cloudpoint Technology Berhad are associated (or correlated) with CPE Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CPE Technology Berhad has no effect on the direction of Cloudpoint Technology i.e., Cloudpoint Technology and CPE Technology go up and down completely randomly.
Pair Corralation between Cloudpoint Technology and CPE Technology
Assuming the 90 days trading horizon Cloudpoint Technology is expected to generate 2.1 times less return on investment than CPE Technology. But when comparing it to its historical volatility, Cloudpoint Technology Berhad is 1.49 times less risky than CPE Technology. It trades about 0.15 of its potential returns per unit of risk. CPE Technology Berhad is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 78.00 in CPE Technology Berhad on August 30, 2024 and sell it today you would earn a total of 13.00 from holding CPE Technology Berhad or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cloudpoint Technology Berhad vs. CPE Technology Berhad
Performance |
| Timeline |
| Cloudpoint Technology |
| CPE Technology Berhad |
Cloudpoint Technology and CPE Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cloudpoint Technology and CPE Technology
The main advantage of trading using opposite Cloudpoint Technology and CPE Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cloudpoint Technology position performs unexpectedly, CPE Technology 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 CPE Technology will offset losses from the drop in CPE Technology's long position.| Cloudpoint Technology vs. Malayan Banking Bhd | Cloudpoint Technology vs. Public Bank Bhd | Cloudpoint Technology vs. Petronas Chemicals Group | Cloudpoint Technology vs. IHH Healthcare Bhd |
| CPE Technology vs. Malayan Banking Bhd | CPE Technology vs. Public Bank Bhd | CPE Technology vs. Petronas Chemicals Group | CPE Technology vs. IHH Healthcare Bhd |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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