Correlation Between Amata Summit and CPN Commercial
Can any of the company-specific risk be diversified away by investing in both Amata Summit and CPN Commercial 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 Amata Summit and CPN Commercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amata Summit Growth and CPN Commercial Growth, you can compare the effects of market volatilities on Amata Summit and CPN Commercial 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 Amata Summit with a short position of CPN Commercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amata Summit and CPN Commercial.
Diversification Opportunities for Amata Summit and CPN Commercial
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Amata and CPN is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Amata Summit Growth and CPN Commercial Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CPN Commercial Growth and Amata Summit 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 Amata Summit Growth are associated (or correlated) with CPN Commercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CPN Commercial Growth has no effect on the direction of Amata Summit i.e., Amata Summit and CPN Commercial go up and down completely randomly.
Pair Corralation between Amata Summit and CPN Commercial
Assuming the 90 days trading horizon Amata Summit Growth is expected to generate 0.42 times more return on investment than CPN Commercial. However, Amata Summit Growth is 2.37 times less risky than CPN Commercial. It trades about 0.22 of its potential returns per unit of risk. CPN Commercial Growth is currently generating about -0.02 per unit of risk. If you would invest 644.00 in Amata Summit Growth on September 1, 2024 and sell it today you would earn a total of 21.00 from holding Amata Summit Growth or generate 3.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Amata Summit Growth vs. CPN Commercial Growth
Performance |
| Timeline |
| Amata Summit Growth |
| CPN Commercial Growth |
Amata Summit and CPN Commercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amata Summit and CPN Commercial
The main advantage of trading using opposite Amata Summit and CPN Commercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amata Summit position performs unexpectedly, CPN Commercial 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 CPN Commercial will offset losses from the drop in CPN Commercial's long position.| Amata Summit vs. Quality Houses Property | Amata Summit vs. CPN Retail Growth | Amata Summit vs. LH Shopping Centers | Amata Summit vs. Quality Houses Hotel |
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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