Correlation Between CDW Corp and Compania Cervecerias
Can any of the company-specific risk be diversified away by investing in both CDW Corp and Compania Cervecerias 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 CDW Corp and Compania Cervecerias into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CDW Corp and Compania Cervecerias Unidas, you can compare the effects of market volatilities on CDW Corp and Compania Cervecerias 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 CDW Corp with a short position of Compania Cervecerias. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDW Corp and Compania Cervecerias.
Diversification Opportunities for CDW Corp and Compania Cervecerias
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between CDW and Compania is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding CDW Corp and Compania Cervecerias Unidas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compania Cervecerias and CDW Corp 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 CDW Corp are associated (or correlated) with Compania Cervecerias. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compania Cervecerias has no effect on the direction of CDW Corp i.e., CDW Corp and Compania Cervecerias go up and down completely randomly.
Pair Corralation between CDW Corp and Compania Cervecerias
Considering the 90-day investment horizon CDW Corp is expected to under-perform the Compania Cervecerias. But the stock apears to be less risky and, when comparing its historical volatility, CDW Corp is 1.05 times less risky than Compania Cervecerias. The stock trades about -0.02 of its potential returns per unit of risk. The Compania Cervecerias Unidas is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,164 in Compania Cervecerias Unidas on August 29, 2024 and sell it today you would lose (32.00) from holding Compania Cervecerias Unidas or give up 2.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CDW Corp vs. Compania Cervecerias Unidas
Performance |
| Timeline |
| CDW Corp |
| Compania Cervecerias |
CDW Corp and Compania Cervecerias Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CDW Corp and Compania Cervecerias
The main advantage of trading using opposite CDW Corp and Compania Cervecerias positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CDW Corp position performs unexpectedly, Compania Cervecerias 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 Compania Cervecerias will offset losses from the drop in Compania Cervecerias' long position.| CDW Corp vs. CACI International | CDW Corp vs. Jack Henry Associates | CDW Corp vs. Broadridge Financial Solutions | CDW Corp vs. ExlService Holdings |
| Compania Cervecerias vs. Fomento Economico Mexicano | Compania Cervecerias vs. Carlsberg AS | Compania Cervecerias vs. Molson Coors Beverage | Compania Cervecerias vs. Molson Coors Brewing |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |