Correlation Between Casio Computer and Peak Resources
Can any of the company-specific risk be diversified away by investing in both Casio Computer and Peak Resources 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 Casio Computer and Peak Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Casio Computer CoLtd and Peak Resources Limited, you can compare the effects of market volatilities on Casio Computer and Peak Resources 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 Casio Computer with a short position of Peak Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Casio Computer and Peak Resources.
Diversification Opportunities for Casio Computer and Peak Resources
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Casio and Peak is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Casio Computer CoLtd and Peak Resources Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peak Resources and Casio Computer 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 Casio Computer CoLtd are associated (or correlated) with Peak Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peak Resources has no effect on the direction of Casio Computer i.e., Casio Computer and Peak Resources go up and down completely randomly.
Pair Corralation between Casio Computer and Peak Resources
Assuming the 90 days trading horizon Casio Computer CoLtd is expected to generate 0.2 times more return on investment than Peak Resources. However, Casio Computer CoLtd is 4.93 times less risky than Peak Resources. It trades about 0.01 of its potential returns per unit of risk. Peak Resources Limited is currently generating about -0.01 per unit of risk. If you would invest 760.00 in Casio Computer CoLtd on September 14, 2024 and sell it today you would earn a total of 19.00 from holding Casio Computer CoLtd or generate 2.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Casio Computer CoLtd vs. Peak Resources Limited
Performance |
| Timeline |
| Casio Computer CoLtd |
| Peak Resources |
Casio Computer and Peak Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Casio Computer and Peak Resources
The main advantage of trading using opposite Casio Computer and Peak Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Casio Computer position performs unexpectedly, Peak Resources 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 Peak Resources will offset losses from the drop in Peak Resources' long position.| Casio Computer vs. Samsung Electronics Co | Casio Computer vs. Sony Group | Casio Computer vs. Superior Plus Corp | Casio Computer vs. SIVERS SEMICONDUCTORS AB |
| Peak Resources vs. Siamgas And Petrochemicals | Peak Resources vs. Public Storage | Peak Resources vs. Casio Computer CoLtd | Peak Resources vs. Datang International Power |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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