Correlation Between CTCI Corp and Cathay DJIA
Can any of the company-specific risk be diversified away by investing in both CTCI Corp and Cathay DJIA 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 CTCI Corp and Cathay DJIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CTCI Corp and Cathay DJIA Inv, you can compare the effects of market volatilities on CTCI Corp and Cathay DJIA 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 CTCI Corp with a short position of Cathay DJIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of CTCI Corp and Cathay DJIA.
Diversification Opportunities for CTCI Corp and Cathay DJIA
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CTCI and Cathay is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding CTCI Corp and Cathay DJIA Inv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cathay DJIA Inv and CTCI Corp 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 CTCI Corp are associated (or correlated) with Cathay DJIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cathay DJIA Inv has no effect on the direction of CTCI Corp i.e., CTCI Corp and Cathay DJIA go up and down completely randomly.
Pair Corralation between CTCI Corp and Cathay DJIA
Assuming the 90 days trading horizon CTCI Corp is expected to under-perform the Cathay DJIA. In addition to that, CTCI Corp is 1.17 times more volatile than Cathay DJIA Inv. It trades about -0.37 of its total potential returns per unit of risk. Cathay DJIA Inv is currently generating about -0.31 per unit of volatility. If you would invest 668.00 in Cathay DJIA Inv on September 5, 2024 and sell it today you would lose (37.00) from holding Cathay DJIA Inv or give up 5.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CTCI Corp vs. Cathay DJIA Inv
Performance |
| Timeline |
| CTCI Corp |
| Cathay DJIA Inv |
CTCI Corp and Cathay DJIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CTCI Corp and Cathay DJIA
The main advantage of trading using opposite CTCI Corp and Cathay DJIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CTCI Corp position performs unexpectedly, Cathay DJIA 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 Cathay DJIA will offset losses from the drop in Cathay DJIA's long position.| CTCI Corp vs. Universal Microelectronics Co | CTCI Corp vs. AVerMedia Technologies | CTCI Corp vs. Symtek Automation Asia | CTCI Corp vs. WiseChip Semiconductor |
| Cathay DJIA vs. Ruentex Development Co | Cathay DJIA vs. Symtek Automation Asia | Cathay DJIA vs. CTCI Corp | Cathay DJIA vs. Information Technology Total |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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