Correlation Between ChipsMedia and Camus Engineering
Can any of the company-specific risk be diversified away by investing in both ChipsMedia and Camus Engineering 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 ChipsMedia and Camus Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChipsMedia and Camus Engineering Construction, you can compare the effects of market volatilities on ChipsMedia and Camus Engineering 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 ChipsMedia with a short position of Camus Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChipsMedia and Camus Engineering.
Diversification Opportunities for ChipsMedia and Camus Engineering
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ChipsMedia and Camus is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding ChipsMedia and Camus Engineering Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Camus Engineering and ChipsMedia 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 ChipsMedia are associated (or correlated) with Camus Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Camus Engineering has no effect on the direction of ChipsMedia i.e., ChipsMedia and Camus Engineering go up and down completely randomly.
Pair Corralation between ChipsMedia and Camus Engineering
Assuming the 90 days trading horizon ChipsMedia is expected to generate 1.25 times less return on investment than Camus Engineering. But when comparing it to its historical volatility, ChipsMedia is 1.14 times less risky than Camus Engineering. It trades about 0.07 of its potential returns per unit of risk. Camus Engineering Construction is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 133,500 in Camus Engineering Construction on October 12, 2024 and sell it today you would earn a total of 22,300 from holding Camus Engineering Construction or generate 16.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChipsMedia vs. Camus Engineering Construction
Performance |
| Timeline |
| ChipsMedia |
| Camus Engineering |
ChipsMedia and Camus Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChipsMedia and Camus Engineering
The main advantage of trading using opposite ChipsMedia and Camus Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChipsMedia position performs unexpectedly, Camus Engineering 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 Camus Engineering will offset losses from the drop in Camus Engineering's long position.| ChipsMedia vs. MediaZen | ChipsMedia vs. Samlip General Foods | ChipsMedia vs. Digital Multimedia Technology | ChipsMedia vs. Samyang Foods Co |
| Camus Engineering vs. DC Media Co | Camus Engineering vs. ChipsMedia | Camus Engineering vs. MediaZen | Camus Engineering vs. SAMG Entertainment Co |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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