Correlation Between Raymond James and Ceres Power
Can any of the company-specific risk be diversified away by investing in both Raymond James and Ceres Power 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 Raymond James and Ceres Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raymond James Financial and Ceres Power Holdings, you can compare the effects of market volatilities on Raymond James and Ceres Power 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 Raymond James with a short position of Ceres Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raymond James and Ceres Power.
Diversification Opportunities for Raymond James and Ceres Power
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Raymond and Ceres is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Raymond James Financial and Ceres Power Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ceres Power Holdings and Raymond James 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 Raymond James Financial are associated (or correlated) with Ceres Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ceres Power Holdings has no effect on the direction of Raymond James i.e., Raymond James and Ceres Power go up and down completely randomly.
Pair Corralation between Raymond James and Ceres Power
Assuming the 90 days trading horizon Raymond James Financial is expected to generate 0.64 times more return on investment than Ceres Power. However, Raymond James Financial is 1.56 times less risky than Ceres Power. It trades about 0.32 of its potential returns per unit of risk. Ceres Power Holdings is currently generating about -0.18 per unit of risk. If you would invest 15,658 in Raymond James Financial on October 25, 2024 and sell it today you would earn a total of 1,344 from holding Raymond James Financial or generate 8.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 84.21% |
| Values | Daily Returns |
Raymond James Financial vs. Ceres Power Holdings
Performance |
| Timeline |
| Raymond James Financial |
| Ceres Power Holdings |
Raymond James and Ceres Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Raymond James and Ceres Power
The main advantage of trading using opposite Raymond James and Ceres Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raymond James position performs unexpectedly, Ceres Power 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 Ceres Power will offset losses from the drop in Ceres Power's long position.| Raymond James vs. Smithson Investment Trust | Raymond James vs. EJF Investments | Raymond James vs. Samsung Electronics Co | Raymond James vs. CleanTech Lithium plc |
| Ceres Power vs. Broadridge Financial Solutions | Ceres Power vs. Broadcom | Ceres Power vs. EVS Broadcast Equipment | Ceres Power vs. Mobius Investment Trust |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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