Correlation Between Cabot and OFFICE DEPOT
Can any of the company-specific risk be diversified away by investing in both Cabot and OFFICE DEPOT 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 Cabot and OFFICE DEPOT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cabot and OFFICE DEPOT, you can compare the effects of market volatilities on Cabot and OFFICE DEPOT 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 Cabot with a short position of OFFICE DEPOT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cabot and OFFICE DEPOT.
Diversification Opportunities for Cabot and OFFICE DEPOT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cabot and OFFICE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cabot and OFFICE DEPOT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFFICE DEPOT and Cabot 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 Cabot are associated (or correlated) with OFFICE DEPOT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFFICE DEPOT has no effect on the direction of Cabot i.e., Cabot and OFFICE DEPOT go up and down completely randomly.
Pair Corralation between Cabot and OFFICE DEPOT
If you would invest 1,920 in OFFICE DEPOT on October 24, 2024 and sell it today you would earn a total of 0.00 from holding OFFICE DEPOT or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.78% |
| Values | Daily Returns |
Cabot vs. OFFICE DEPOT
Performance |
| Timeline |
| Cabot |
| OFFICE DEPOT |
Cabot and OFFICE DEPOT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cabot and OFFICE DEPOT
The main advantage of trading using opposite Cabot and OFFICE DEPOT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cabot position performs unexpectedly, OFFICE DEPOT 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 OFFICE DEPOT will offset losses from the drop in OFFICE DEPOT's long position.| Cabot vs. OFFICE DEPOT | Cabot vs. AIR PRODCHEMICALS | Cabot vs. UNIVMUSIC GRPADR050 | Cabot vs. Siamgas And Petrochemicals |
| OFFICE DEPOT vs. United Rentals | OFFICE DEPOT vs. Thai Beverage Public | OFFICE DEPOT vs. China Development Bank | OFFICE DEPOT vs. Sumitomo Mitsui Construction |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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