Correlation Between INTER CARS and Commercial Vehicle
Can any of the company-specific risk be diversified away by investing in both INTER CARS and Commercial Vehicle 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 INTER CARS and Commercial Vehicle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTER CARS SA and Commercial Vehicle Group, you can compare the effects of market volatilities on INTER CARS and Commercial Vehicle 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 INTER CARS with a short position of Commercial Vehicle. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTER CARS and Commercial Vehicle.
Diversification Opportunities for INTER CARS and Commercial Vehicle
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between INTER and Commercial is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding INTER CARS SA and Commercial Vehicle Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial Vehicle and INTER CARS 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 INTER CARS SA are associated (or correlated) with Commercial Vehicle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial Vehicle has no effect on the direction of INTER CARS i.e., INTER CARS and Commercial Vehicle go up and down completely randomly.
Pair Corralation between INTER CARS and Commercial Vehicle
Assuming the 90 days horizon INTER CARS SA is expected to generate 0.45 times more return on investment than Commercial Vehicle. However, INTER CARS SA is 2.23 times less risky than Commercial Vehicle. It trades about -0.05 of its potential returns per unit of risk. Commercial Vehicle Group is currently generating about -0.25 per unit of risk. If you would invest 11,120 in INTER CARS SA on August 29, 2024 and sell it today you would lose (240.00) from holding INTER CARS SA or give up 2.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
INTER CARS SA vs. Commercial Vehicle Group
Performance |
| Timeline |
| INTER CARS SA |
| Commercial Vehicle |
INTER CARS and Commercial Vehicle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTER CARS and Commercial Vehicle
The main advantage of trading using opposite INTER CARS and Commercial Vehicle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTER CARS position performs unexpectedly, Commercial Vehicle 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 Commercial Vehicle will offset losses from the drop in Commercial Vehicle's long position.| INTER CARS vs. PT Astra International | INTER CARS vs. Continental Aktiengesellschaft | INTER CARS vs. Superior Plus Corp | INTER CARS vs. NMI Holdings |
| Commercial Vehicle vs. Apple Inc | Commercial Vehicle vs. Apple Inc | Commercial Vehicle vs. Apple Inc | Commercial Vehicle vs. Apple Inc |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |