Correlation Between Cal Comp and SVI Public
Can any of the company-specific risk be diversified away by investing in both Cal Comp and SVI Public 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 Cal Comp and SVI Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cal Comp Electronics Public and SVI Public, you can compare the effects of market volatilities on Cal Comp and SVI Public 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 Cal Comp with a short position of SVI Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cal Comp and SVI Public.
Diversification Opportunities for Cal Comp and SVI Public
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cal and SVI is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Cal Comp Electronics Public and SVI Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SVI Public and Cal Comp 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 Cal Comp Electronics Public are associated (or correlated) with SVI Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SVI Public has no effect on the direction of Cal Comp i.e., Cal Comp and SVI Public go up and down completely randomly.
Pair Corralation between Cal Comp and SVI Public
Assuming the 90 days trading horizon Cal Comp is expected to generate 4.83 times less return on investment than SVI Public. But when comparing it to its historical volatility, Cal Comp Electronics Public is 12.45 times less risky than SVI Public. It trades about 0.13 of its potential returns per unit of risk. SVI Public is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 779.00 in SVI Public on September 12, 2024 and sell it today you would lose (54.00) from holding SVI Public or give up 6.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cal Comp Electronics Public vs. SVI Public
Performance |
| Timeline |
| Cal Comp Electronics |
| SVI Public |
Cal Comp and SVI Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cal Comp and SVI Public
The main advantage of trading using opposite Cal Comp and SVI Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cal Comp position performs unexpectedly, SVI Public 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 SVI Public will offset losses from the drop in SVI Public's long position.| Cal Comp vs. KCE Electronics Public | Cal Comp vs. Land and Houses | Cal Comp vs. Delta Electronics Public | Cal Comp vs. The Siam Cement |
| SVI Public vs. KCE Electronics Public | SVI Public vs. Land and Houses | SVI Public vs. Delta Electronics Public | SVI Public vs. The Siam Cement |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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