Correlation Between CNVISION MEDIA and FLOW TRADERS
Can any of the company-specific risk be diversified away by investing in both CNVISION MEDIA and FLOW TRADERS 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 CNVISION MEDIA and FLOW TRADERS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CNVISION MEDIA and FLOW TRADERS LTD, you can compare the effects of market volatilities on CNVISION MEDIA and FLOW TRADERS 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 CNVISION MEDIA with a short position of FLOW TRADERS. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNVISION MEDIA and FLOW TRADERS.
Diversification Opportunities for CNVISION MEDIA and FLOW TRADERS
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CNVISION and FLOW is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding CNVISION MEDIA and FLOW TRADERS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FLOW TRADERS LTD and CNVISION MEDIA 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 CNVISION MEDIA are associated (or correlated) with FLOW TRADERS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FLOW TRADERS LTD has no effect on the direction of CNVISION MEDIA i.e., CNVISION MEDIA and FLOW TRADERS go up and down completely randomly.
Pair Corralation between CNVISION MEDIA and FLOW TRADERS
Assuming the 90 days trading horizon CNVISION MEDIA is expected to generate 1.12 times less return on investment than FLOW TRADERS. In addition to that, CNVISION MEDIA is 1.33 times more volatile than FLOW TRADERS LTD. It trades about 0.06 of its total potential returns per unit of risk. FLOW TRADERS LTD is currently generating about 0.08 per unit of volatility. If you would invest 1,612 in FLOW TRADERS LTD on November 3, 2024 and sell it today you would earn a total of 720.00 from holding FLOW TRADERS LTD or generate 44.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CNVISION MEDIA vs. FLOW TRADERS LTD
Performance |
| Timeline |
| CNVISION MEDIA |
| FLOW TRADERS LTD |
CNVISION MEDIA and FLOW TRADERS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNVISION MEDIA and FLOW TRADERS
The main advantage of trading using opposite CNVISION MEDIA and FLOW TRADERS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNVISION MEDIA position performs unexpectedly, FLOW TRADERS 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 FLOW TRADERS will offset losses from the drop in FLOW TRADERS's long position.| CNVISION MEDIA vs. PLAYTECH | CNVISION MEDIA vs. US Physical Therapy | CNVISION MEDIA vs. Siemens Healthineers AG | CNVISION MEDIA vs. Aristocrat Leisure Limited |
| FLOW TRADERS vs. Morgan Stanley | FLOW TRADERS vs. Morgan Stanley | FLOW TRADERS vs. The Charles Schwab | FLOW TRADERS vs. The Goldman Sachs |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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