Correlation Between CSI Compressco and North American
Can any of the company-specific risk be diversified away by investing in both CSI Compressco and North American 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 CSI Compressco and North American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CSI Compressco LP and North American Construction, you can compare the effects of market volatilities on CSI Compressco and North American 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 CSI Compressco with a short position of North American. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSI Compressco and North American.
Diversification Opportunities for CSI Compressco and North American
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CSI and North is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding CSI Compressco LP and North American Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North American Const and CSI Compressco 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 CSI Compressco LP are associated (or correlated) with North American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North American Const has no effect on the direction of CSI Compressco i.e., CSI Compressco and North American go up and down completely randomly.
Pair Corralation between CSI Compressco and North American
If you would invest 1,701 in North American Construction on August 24, 2024 and sell it today you would earn a total of 273.00 from holding North American Construction or generate 16.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
CSI Compressco LP vs. North American Construction
Performance |
| Timeline |
| CSI Compressco LP |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| North American Const |
CSI Compressco and North American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSI Compressco and North American
The main advantage of trading using opposite CSI Compressco and North American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSI Compressco position performs unexpectedly, North American 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 North American will offset losses from the drop in North American's long position.| CSI Compressco vs. Geospace Technologies | CSI Compressco vs. MRC Global | CSI Compressco vs. North American Construction | CSI Compressco vs. Natural Gas Services |
| North American vs. Geospace Technologies | North American vs. MRC Global | North American vs. Natural Gas Services | North American vs. Now Inc |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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