Correlation Between CTCI Corp and Kinko Optical
Can any of the company-specific risk be diversified away by investing in both CTCI Corp and Kinko Optical 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 Kinko Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CTCI Corp and Kinko Optical Co, you can compare the effects of market volatilities on CTCI Corp and Kinko Optical 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 Kinko Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of CTCI Corp and Kinko Optical.
Diversification Opportunities for CTCI Corp and Kinko Optical
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CTCI and Kinko is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding CTCI Corp and Kinko Optical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinko Optical 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 Kinko Optical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinko Optical has no effect on the direction of CTCI Corp i.e., CTCI Corp and Kinko Optical go up and down completely randomly.
Pair Corralation between CTCI Corp and Kinko Optical
Assuming the 90 days trading horizon CTCI Corp is expected to under-perform the Kinko Optical. But the stock apears to be less risky and, when comparing its historical volatility, CTCI Corp is 1.45 times less risky than Kinko Optical. The stock trades about -0.36 of its potential returns per unit of risk. The Kinko Optical Co is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 2,510 in Kinko Optical Co on September 1, 2024 and sell it today you would lose (65.00) from holding Kinko Optical Co or give up 2.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
CTCI Corp vs. Kinko Optical Co
Performance |
| Timeline |
| CTCI Corp |
| Kinko Optical |
CTCI Corp and Kinko Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CTCI Corp and Kinko Optical
The main advantage of trading using opposite CTCI Corp and Kinko Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CTCI Corp position performs unexpectedly, Kinko Optical 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 Kinko Optical will offset losses from the drop in Kinko Optical's long position.| CTCI Corp vs. Taiwan Secom Co | CTCI Corp vs. Pou Chen Corp | CTCI Corp vs. Formosa Petrochemical Corp | CTCI Corp vs. Cheng Shin Rubber |
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 Stocks Directory module to find actively traded stocks across global markets.
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