Correlation Between Aluminumof China and Comstock Holding
Can any of the company-specific risk be diversified away by investing in both Aluminumof China and Comstock Holding 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 Aluminumof China and Comstock Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aluminum of and Comstock Holding Companies, you can compare the effects of market volatilities on Aluminumof China and Comstock Holding 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 Aluminumof China with a short position of Comstock Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aluminumof China and Comstock Holding.
Diversification Opportunities for Aluminumof China and Comstock Holding
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Aluminumof and Comstock is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Aluminum of and Comstock Holding Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Holding Com and Aluminumof China 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 Aluminum of are associated (or correlated) with Comstock Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Holding Com has no effect on the direction of Aluminumof China i.e., Aluminumof China and Comstock Holding go up and down completely randomly.
Pair Corralation between Aluminumof China and Comstock Holding
Assuming the 90 days horizon Aluminumof China is expected to generate 1.28 times less return on investment than Comstock Holding. But when comparing it to its historical volatility, Aluminum of is 1.15 times less risky than Comstock Holding. It trades about 0.05 of its potential returns per unit of risk. Comstock Holding Companies is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 368.00 in Comstock Holding Companies on October 15, 2024 and sell it today you would earn a total of 422.00 from holding Comstock Holding Companies or generate 114.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aluminum of vs. Comstock Holding Companies
Performance |
| Timeline |
| Aluminumof China |
| Comstock Holding Com |
Aluminumof China and Comstock Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aluminumof China and Comstock Holding
The main advantage of trading using opposite Aluminumof China and Comstock Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aluminumof China position performs unexpectedly, Comstock Holding 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 Comstock Holding will offset losses from the drop in Comstock Holding's long position.| Aluminumof China vs. GOODYEAR T RUBBER | Aluminumof China vs. PLAYTIKA HOLDING DL 01 | Aluminumof China vs. VIVA WINE GROUP | Aluminumof China vs. Playmates Toys Limited |
| Comstock Holding vs. Apple Inc | Comstock Holding vs. Apple Inc | Comstock Holding vs. Apple Inc | Comstock Holding 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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