Correlation Between Cboe UK and Future Metals
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By analyzing existing cross correlation between Cboe UK Consumer and Future Metals NL, you can compare the effects of market volatilities on Cboe UK and Future Metals 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 Cboe UK with a short position of Future Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cboe UK and Future Metals.
Diversification Opportunities for Cboe UK and Future Metals
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Cboe and Future is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Cboe UK Consumer and Future Metals NL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Future Metals NL and Cboe UK 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 Cboe UK Consumer are associated (or correlated) with Future Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Future Metals NL has no effect on the direction of Cboe UK i.e., Cboe UK and Future Metals go up and down completely randomly.
Pair Corralation between Cboe UK and Future Metals
Assuming the 90 days trading horizon Cboe UK Consumer is expected to under-perform the Future Metals. But the index apears to be less risky and, when comparing its historical volatility, Cboe UK Consumer is 5.04 times less risky than Future Metals. The index trades about -0.01 of its potential returns per unit of risk. The Future Metals NL is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 57.00 in Future Metals NL on November 28, 2024 and sell it today you would earn a total of 18.00 from holding Future Metals NL or generate 31.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cboe UK Consumer vs. Future Metals NL
Performance |
| Timeline |
Cboe UK and Future Metals Volatility Contrast
Predicted Return Density |
| Returns |
Cboe UK Consumer
Pair trading matchups for Cboe UK
Future Metals NL
Pair trading matchups for Future Metals
Pair Trading with Cboe UK and Future Metals
The main advantage of trading using opposite Cboe UK and Future Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cboe UK position performs unexpectedly, Future Metals 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 Future Metals will offset losses from the drop in Future Metals' long position.| Cboe UK vs. Seche Environnement SA | Cboe UK vs. Premier Foods PLC | Cboe UK vs. Monster Beverage Corp | Cboe UK vs. MoneysupermarketCom Group PLC |
| Future Metals vs. Central Asia Metals | Future Metals vs. Science in Sport | Future Metals vs. First Class Metals | Future Metals vs. Golden Metal Resources |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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