Correlation Between Cairo Communication and Grieg Seafood
Can any of the company-specific risk be diversified away by investing in both Cairo Communication and Grieg Seafood 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 Cairo Communication and Grieg Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cairo Communication SpA and Grieg Seafood, you can compare the effects of market volatilities on Cairo Communication and Grieg Seafood 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 Cairo Communication with a short position of Grieg Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cairo Communication and Grieg Seafood.
Diversification Opportunities for Cairo Communication and Grieg Seafood
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cairo and Grieg is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Cairo Communication SpA and Grieg Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grieg Seafood and Cairo Communication 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 Cairo Communication SpA are associated (or correlated) with Grieg Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grieg Seafood has no effect on the direction of Cairo Communication i.e., Cairo Communication and Grieg Seafood go up and down completely randomly.
Pair Corralation between Cairo Communication and Grieg Seafood
Assuming the 90 days trading horizon Cairo Communication SpA is expected to generate 0.71 times more return on investment than Grieg Seafood. However, Cairo Communication SpA is 1.41 times less risky than Grieg Seafood. It trades about -0.07 of its potential returns per unit of risk. Grieg Seafood is currently generating about -0.11 per unit of risk. If you would invest 250.00 in Cairo Communication SpA on October 10, 2024 and sell it today you would lose (6.00) from holding Cairo Communication SpA or give up 2.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cairo Communication SpA vs. Grieg Seafood
Performance |
| Timeline |
| Cairo Communication SpA |
| Grieg Seafood |
Cairo Communication and Grieg Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cairo Communication and Grieg Seafood
The main advantage of trading using opposite Cairo Communication and Grieg Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cairo Communication position performs unexpectedly, Grieg Seafood 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 Grieg Seafood will offset losses from the drop in Grieg Seafood's long position.| Cairo Communication vs. Ubisoft Entertainment | Cairo Communication vs. Liberty Media Corp | Cairo Communication vs. Grand Vision Media | Cairo Communication vs. MediaZest plc |
| Grieg Seafood vs. Kaufman Et Broad | Grieg Seafood vs. Aptitude Software Group | Grieg Seafood vs. Universal Music Group | Grieg Seafood vs. Gaztransport et Technigaz |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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