Correlation Between CU Medical and AeroSpace Technology
Can any of the company-specific risk be diversified away by investing in both CU Medical and AeroSpace Technology 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 CU Medical and AeroSpace Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CU Medical Systems and AeroSpace Technology of, you can compare the effects of market volatilities on CU Medical and AeroSpace Technology 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 CU Medical with a short position of AeroSpace Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of CU Medical and AeroSpace Technology.
Diversification Opportunities for CU Medical and AeroSpace Technology
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 115480 and AeroSpace is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding CU Medical Systems and AeroSpace Technology of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AeroSpace Technology and CU Medical 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 CU Medical Systems are associated (or correlated) with AeroSpace Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AeroSpace Technology has no effect on the direction of CU Medical i.e., CU Medical and AeroSpace Technology go up and down completely randomly.
Pair Corralation between CU Medical and AeroSpace Technology
Assuming the 90 days trading horizon CU Medical Systems is expected to generate 0.38 times more return on investment than AeroSpace Technology. However, CU Medical Systems is 2.61 times less risky than AeroSpace Technology. It trades about -0.03 of its potential returns per unit of risk. AeroSpace Technology of is currently generating about -0.05 per unit of risk. If you would invest 79,300 in CU Medical Systems on November 3, 2024 and sell it today you would lose (12,700) from holding CU Medical Systems or give up 16.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.34% |
| Values | Daily Returns |
CU Medical Systems vs. AeroSpace Technology of
Performance |
| Timeline |
| CU Medical Systems |
| AeroSpace Technology |
CU Medical and AeroSpace Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CU Medical and AeroSpace Technology
The main advantage of trading using opposite CU Medical and AeroSpace Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CU Medical position performs unexpectedly, AeroSpace Technology 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 AeroSpace Technology will offset losses from the drop in AeroSpace Technology's long position.| CU Medical vs. Puloon Technology | CU Medical vs. KG Eco Technology | CU Medical vs. Netmarble Games Corp | CU Medical vs. iNtRON Biotechnology |
| AeroSpace Technology vs. Cuckoo Electronics Co | AeroSpace Technology vs. Kolon Plastics | AeroSpace Technology vs. Ecoplastic | AeroSpace Technology vs. RF Materials 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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