Correlation Between INPOST SA and Cintas
Can any of the company-specific risk be diversified away by investing in both INPOST SA and Cintas 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 INPOST SA and Cintas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INPOST SA EO and Cintas, you can compare the effects of market volatilities on INPOST SA and Cintas 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 INPOST SA with a short position of Cintas. Check out your portfolio center. Please also check ongoing floating volatility patterns of INPOST SA and Cintas.
Diversification Opportunities for INPOST SA and Cintas
Good diversification
The 3 months correlation between INPOST and Cintas is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding INPOST SA EO and Cintas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cintas and INPOST SA 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 INPOST SA EO are associated (or correlated) with Cintas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cintas has no effect on the direction of INPOST SA i.e., INPOST SA and Cintas go up and down completely randomly.
Pair Corralation between INPOST SA and Cintas
Assuming the 90 days horizon INPOST SA EO is expected to generate 1.56 times more return on investment than Cintas. However, INPOST SA is 1.56 times more volatile than Cintas. It trades about 0.08 of its potential returns per unit of risk. Cintas is currently generating about 0.09 per unit of risk. If you would invest 796.00 in INPOST SA EO on September 23, 2024 and sell it today you would earn a total of 809.00 from holding INPOST SA EO or generate 101.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
INPOST SA EO vs. Cintas
Performance |
| Timeline |
| INPOST SA EO |
| Cintas |
INPOST SA and Cintas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INPOST SA and Cintas
The main advantage of trading using opposite INPOST SA and Cintas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INPOST SA position performs unexpectedly, Cintas 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 Cintas will offset losses from the drop in Cintas' long position.| INPOST SA vs. Cintas | INPOST SA vs. RENTOKIL INITIAL ADR5 | INPOST SA vs. Elis SA | INPOST SA vs. PARK24 LTD |
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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