Correlation Between Cuckoo Homesys and BIT Computer
Can any of the company-specific risk be diversified away by investing in both Cuckoo Homesys and BIT Computer 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 Cuckoo Homesys and BIT Computer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cuckoo Homesys Co and BIT Computer Co, you can compare the effects of market volatilities on Cuckoo Homesys and BIT Computer 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 Cuckoo Homesys with a short position of BIT Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cuckoo Homesys and BIT Computer.
Diversification Opportunities for Cuckoo Homesys and BIT Computer
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cuckoo and BIT is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Cuckoo Homesys Co and BIT Computer Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BIT Computer and Cuckoo Homesys 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 Cuckoo Homesys Co are associated (or correlated) with BIT Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BIT Computer has no effect on the direction of Cuckoo Homesys i.e., Cuckoo Homesys and BIT Computer go up and down completely randomly.
Pair Corralation between Cuckoo Homesys and BIT Computer
Assuming the 90 days trading horizon Cuckoo Homesys Co is expected to under-perform the BIT Computer. But the stock apears to be less risky and, when comparing its historical volatility, Cuckoo Homesys Co is 1.04 times less risky than BIT Computer. The stock trades about -0.25 of its potential returns per unit of risk. The BIT Computer Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 496,000 in BIT Computer Co on September 3, 2024 and sell it today you would earn a total of 5,000 from holding BIT Computer Co or generate 1.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cuckoo Homesys Co vs. BIT Computer Co
Performance |
| Timeline |
| Cuckoo Homesys |
| BIT Computer |
Cuckoo Homesys and BIT Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cuckoo Homesys and BIT Computer
The main advantage of trading using opposite Cuckoo Homesys and BIT Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cuckoo Homesys position performs unexpectedly, BIT Computer 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 BIT Computer will offset losses from the drop in BIT Computer's long position.| Cuckoo Homesys vs. Korean Air Lines | Cuckoo Homesys vs. CU Medical Systems | Cuckoo Homesys vs. Home Center Holdings | Cuckoo Homesys vs. Korean Drug Co |
| BIT Computer vs. CKH Food Health | BIT Computer vs. Polaris Office Corp | BIT Computer vs. Cuckoo Homesys Co | BIT Computer vs. Samlip General Foods |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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