Correlation Between CTT - and JAPAN EX
Can any of the company-specific risk be diversified away by investing in both CTT - and JAPAN EX 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 CTT - and JAPAN EX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CTT Correios and JAPAN EX UNADR, you can compare the effects of market volatilities on CTT - and JAPAN EX 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 CTT - with a short position of JAPAN EX. Check out your portfolio center. Please also check ongoing floating volatility patterns of CTT - and JAPAN EX.
Diversification Opportunities for CTT - and JAPAN EX
Pay attention - limited upside
The 3 months correlation between CTT and JAPAN is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding CTT Correios and JAPAN EX UNADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAPAN EX UNADR and CTT - 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 CTT Correios are associated (or correlated) with JAPAN EX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAPAN EX UNADR has no effect on the direction of CTT - i.e., CTT - and JAPAN EX go up and down completely randomly.
Pair Corralation between CTT - and JAPAN EX
Assuming the 90 days horizon CTT Correios is expected to generate 0.99 times more return on investment than JAPAN EX. However, CTT Correios is 1.01 times less risky than JAPAN EX. It trades about 0.07 of its potential returns per unit of risk. JAPAN EX UNADR is currently generating about 0.07 per unit of risk. If you would invest 339.00 in CTT Correios on November 2, 2024 and sell it today you would earn a total of 246.00 from holding CTT Correios or generate 72.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CTT Correios vs. JAPAN EX UNADR
Performance |
| Timeline |
| CTT Correios |
| JAPAN EX UNADR |
CTT - and JAPAN EX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CTT - and JAPAN EX
The main advantage of trading using opposite CTT - and JAPAN EX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CTT - position performs unexpectedly, JAPAN EX 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 JAPAN EX will offset losses from the drop in JAPAN EX's long position.| CTT - vs. CAREER EDUCATION | CTT - vs. DeVry Education Group | CTT - vs. Perdoceo Education | CTT - vs. ALEFARM BREWING DK 05 |
| JAPAN EX vs. Inspire Medical Systems | JAPAN EX vs. Yanzhou Coal Mining | JAPAN EX vs. Advanced Medical Solutions | JAPAN EX vs. Avanos Medical |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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