Correlation Between Caterpillar and COMCAST
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By analyzing existing cross correlation between Caterpillar and COMCAST P NEW, you can compare the effects of market volatilities on Caterpillar and COMCAST 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 Caterpillar with a short position of COMCAST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caterpillar and COMCAST.
Diversification Opportunities for Caterpillar and COMCAST
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Caterpillar and COMCAST is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Caterpillar and COMCAST P NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COMCAST P NEW and Caterpillar 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 Caterpillar are associated (or correlated) with COMCAST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COMCAST P NEW has no effect on the direction of Caterpillar i.e., Caterpillar and COMCAST go up and down completely randomly.
Pair Corralation between Caterpillar and COMCAST
Considering the 90-day investment horizon Caterpillar is expected to generate 20.93 times less return on investment than COMCAST. But when comparing it to its historical volatility, Caterpillar is 36.85 times less risky than COMCAST. It trades about 0.1 of its potential returns per unit of risk. COMCAST P NEW is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 9,112 in COMCAST P NEW on September 2, 2024 and sell it today you would earn a total of 464.00 from holding COMCAST P NEW or generate 5.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 70.7% |
| Values | Daily Returns |
Caterpillar vs. COMCAST P NEW
Performance |
| Timeline |
| Caterpillar |
| COMCAST P NEW |
Caterpillar and COMCAST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caterpillar and COMCAST
The main advantage of trading using opposite Caterpillar and COMCAST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caterpillar position performs unexpectedly, COMCAST 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 COMCAST will offset losses from the drop in COMCAST's long position.| Caterpillar vs. AGCO Corporation | Caterpillar vs. Nikola Corp | Caterpillar vs. PACCAR Inc | Caterpillar vs. Deere Company |
| COMCAST vs. Cedar Realty Trust | COMCAST vs. Fast Retailing Co | COMCAST vs. Coupang LLC | COMCAST vs. Zoom Video Communications |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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