Correlation Between Capital Income and Alfi
Can any of the company-specific risk be diversified away by investing in both Capital Income and Alfi 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 Capital Income and Alfi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Income Builder and Alfi Inc, you can compare the effects of market volatilities on Capital Income and Alfi 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 Capital Income with a short position of Alfi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Income and Alfi.
Diversification Opportunities for Capital Income and Alfi
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Capital and Alfi is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Capital Income Builder and Alfi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfi Inc and Capital Income 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 Capital Income Builder are associated (or correlated) with Alfi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfi Inc has no effect on the direction of Capital Income i.e., Capital Income and Alfi go up and down completely randomly.
Pair Corralation between Capital Income and Alfi
If you would invest 6,906 in Capital Income Builder on October 24, 2024 and sell it today you would earn a total of 171.00 from holding Capital Income Builder or generate 2.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.56% |
| Values | Daily Returns |
Capital Income Builder vs. Alfi Inc
Performance |
| Timeline |
| Capital Income Builder |
| Alfi Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Capital Income and Alfi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Income and Alfi
The main advantage of trading using opposite Capital Income and Alfi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Income position performs unexpectedly, Alfi 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 Alfi will offset losses from the drop in Alfi's long position.| Capital Income vs. Old Westbury Municipal | Capital Income vs. Lord Abbett Intermediate | Capital Income vs. Blackrock Pa Muni | Capital Income vs. Inverse Government Long |
| Alfi vs. Arax Holdings Corp | Alfi vs. AppTech Payments Corp | Alfi vs. Arbe Robotics Ltd | Alfi vs. Argentum 47 |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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