Correlation Between Caterpillar and ALTAIR RES
Can any of the company-specific risk be diversified away by investing in both Caterpillar and ALTAIR RES 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 Caterpillar and ALTAIR RES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caterpillar and ALTAIR RES INC, you can compare the effects of market volatilities on Caterpillar and ALTAIR RES 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 ALTAIR RES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caterpillar and ALTAIR RES.
Diversification Opportunities for Caterpillar and ALTAIR RES
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Caterpillar and ALTAIR is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Caterpillar and ALTAIR RES INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALTAIR RES INC 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 ALTAIR RES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALTAIR RES INC has no effect on the direction of Caterpillar i.e., Caterpillar and ALTAIR RES go up and down completely randomly.
Pair Corralation between Caterpillar and ALTAIR RES
If you would invest 25,557 in Caterpillar on September 12, 2024 and sell it today you would earn a total of 12,443 from holding Caterpillar or generate 48.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Caterpillar vs. ALTAIR RES INC
Performance |
| Timeline |
| Caterpillar |
| ALTAIR RES INC |
Caterpillar and ALTAIR RES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caterpillar and ALTAIR RES
The main advantage of trading using opposite Caterpillar and ALTAIR RES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caterpillar position performs unexpectedly, ALTAIR RES 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 ALTAIR RES will offset losses from the drop in ALTAIR RES's long position.| Caterpillar vs. AB Volvo | Caterpillar vs. Daimler Truck Holding | Caterpillar vs. Superior Plus Corp | Caterpillar vs. SIVERS SEMICONDUCTORS AB |
| ALTAIR RES vs. American Lithium Corp | ALTAIR RES vs. ADRIATIC METALS LS 013355 | ALTAIR RES vs. Superior Plus Corp | ALTAIR RES vs. SIVERS SEMICONDUCTORS AB |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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