Correlation Between CVR Energy and Beeks Trading
Can any of the company-specific risk be diversified away by investing in both CVR Energy and Beeks Trading 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 CVR Energy and Beeks Trading into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVR Energy and Beeks Trading, you can compare the effects of market volatilities on CVR Energy and Beeks Trading 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 CVR Energy with a short position of Beeks Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Energy and Beeks Trading.
Diversification Opportunities for CVR Energy and Beeks Trading
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CVR and Beeks is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding CVR Energy and Beeks Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beeks Trading and CVR Energy 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 CVR Energy are associated (or correlated) with Beeks Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beeks Trading has no effect on the direction of CVR Energy i.e., CVR Energy and Beeks Trading go up and down completely randomly.
Pair Corralation between CVR Energy and Beeks Trading
Assuming the 90 days trading horizon CVR Energy is expected to generate 1.83 times more return on investment than Beeks Trading. However, CVR Energy is 1.83 times more volatile than Beeks Trading. It trades about 0.23 of its potential returns per unit of risk. Beeks Trading is currently generating about 0.01 per unit of risk. If you would invest 1,602 in CVR Energy on September 2, 2024 and sell it today you would earn a total of 324.00 from holding CVR Energy or generate 20.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
CVR Energy vs. Beeks Trading
Performance |
| Timeline |
| CVR Energy |
| Beeks Trading |
CVR Energy and Beeks Trading Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVR Energy and Beeks Trading
The main advantage of trading using opposite CVR Energy and Beeks Trading positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVR Energy position performs unexpectedly, Beeks Trading 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 Beeks Trading will offset losses from the drop in Beeks Trading's long position.| CVR Energy vs. Uniper SE | CVR Energy vs. Mulberry Group PLC | CVR Energy vs. London Security Plc | CVR Energy vs. Triad Group PLC |
| Beeks Trading vs. GreenX Metals | Beeks Trading vs. Neometals | Beeks Trading vs. Silvercorp Metals | Beeks Trading vs. Wheaton Precious Metals |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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