Correlation Between CEOTRONICS and BRIT AMER
Can any of the company-specific risk be diversified away by investing in both CEOTRONICS and BRIT AMER 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 CEOTRONICS and BRIT AMER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CEOTRONICS and BRIT AMER TOBACCO, you can compare the effects of market volatilities on CEOTRONICS and BRIT AMER 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 CEOTRONICS with a short position of BRIT AMER. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEOTRONICS and BRIT AMER.
Diversification Opportunities for CEOTRONICS and BRIT AMER
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between CEOTRONICS and BRIT is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding CEOTRONICS and BRIT AMER TOBACCO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRIT AMER TOBACCO and CEOTRONICS 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 CEOTRONICS are associated (or correlated) with BRIT AMER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRIT AMER TOBACCO has no effect on the direction of CEOTRONICS i.e., CEOTRONICS and BRIT AMER go up and down completely randomly.
Pair Corralation between CEOTRONICS and BRIT AMER
Assuming the 90 days trading horizon CEOTRONICS is expected to generate 2.68 times more return on investment than BRIT AMER. However, CEOTRONICS is 2.68 times more volatile than BRIT AMER TOBACCO. It trades about 0.07 of its potential returns per unit of risk. BRIT AMER TOBACCO is currently generating about 0.12 per unit of risk. If you would invest 408.00 in CEOTRONICS on September 3, 2024 and sell it today you would earn a total of 212.00 from holding CEOTRONICS or generate 51.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CEOTRONICS vs. BRIT AMER TOBACCO
Performance |
| Timeline |
| CEOTRONICS |
| BRIT AMER TOBACCO |
CEOTRONICS and BRIT AMER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CEOTRONICS and BRIT AMER
The main advantage of trading using opposite CEOTRONICS and BRIT AMER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEOTRONICS position performs unexpectedly, BRIT AMER 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 BRIT AMER will offset losses from the drop in BRIT AMER's long position.| CEOTRONICS vs. Xenia Hotels Resorts | CEOTRONICS vs. Wyndham Hotels Resorts | CEOTRONICS vs. NH HOTEL GROUP | CEOTRONICS vs. Japan Asia Investment |
| BRIT AMER vs. FEMALE HEALTH | BRIT AMER vs. PARKEN Sport Entertainment | BRIT AMER vs. Amkor Technology | BRIT AMER vs. CVS Health |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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