Correlation Between CVR Energy and Various Eateries
Can any of the company-specific risk be diversified away by investing in both CVR Energy and Various Eateries 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 Various Eateries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVR Energy and Various Eateries PLC, you can compare the effects of market volatilities on CVR Energy and Various Eateries 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 Various Eateries. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Energy and Various Eateries.
Diversification Opportunities for CVR Energy and Various Eateries
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CVR and Various is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding CVR Energy and Various Eateries PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Various Eateries PLC 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 Various Eateries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Various Eateries PLC has no effect on the direction of CVR Energy i.e., CVR Energy and Various Eateries go up and down completely randomly.
Pair Corralation between CVR Energy and Various Eateries
Assuming the 90 days trading horizon CVR Energy is expected to generate 1.68 times more return on investment than Various Eateries. However, CVR Energy is 1.68 times more volatile than Various Eateries PLC. It trades about -0.01 of its potential returns per unit of risk. Various Eateries PLC is currently generating about -0.13 per unit of risk. If you would invest 2,523 in CVR Energy on September 2, 2024 and sell it today you would lose (597.00) from holding CVR Energy or give up 23.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 89.92% |
| Values | Daily Returns |
CVR Energy vs. Various Eateries PLC
Performance |
| Timeline |
| CVR Energy |
| Various Eateries PLC |
CVR Energy and Various Eateries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVR Energy and Various Eateries
The main advantage of trading using opposite CVR Energy and Various Eateries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVR Energy position performs unexpectedly, Various Eateries 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 Various Eateries will offset losses from the drop in Various Eateries' 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 |
| Various Eateries vs. Viridian Therapeutics | Various Eateries vs. CVR Energy | Various Eateries vs. Nationwide Building Society | Various Eateries vs. Dollar Tree |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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