Correlation Between Century Aluminum and Capital Senior
Can any of the company-specific risk be diversified away by investing in both Century Aluminum and Capital Senior 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 Century Aluminum and Capital Senior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Century Aluminum and Capital Senior Living, you can compare the effects of market volatilities on Century Aluminum and Capital Senior 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 Century Aluminum with a short position of Capital Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Aluminum and Capital Senior.
Diversification Opportunities for Century Aluminum and Capital Senior
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Century and Capital is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Century Aluminum and Capital Senior Living in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Senior Living and Century Aluminum 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 Century Aluminum are associated (or correlated) with Capital Senior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Senior Living has no effect on the direction of Century Aluminum i.e., Century Aluminum and Capital Senior go up and down completely randomly.
Pair Corralation between Century Aluminum and Capital Senior
If you would invest 1,670 in Century Aluminum on November 27, 2024 and sell it today you would earn a total of 185.00 from holding Century Aluminum or generate 11.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Century Aluminum vs. Capital Senior Living
Performance |
| Timeline |
| Century Aluminum |
| Capital Senior Living |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Century Aluminum and Capital Senior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Century Aluminum and Capital Senior
The main advantage of trading using opposite Century Aluminum and Capital Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Century Aluminum position performs unexpectedly, Capital Senior 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 Capital Senior will offset losses from the drop in Capital Senior's long position.| Century Aluminum vs. Kaiser Aluminum | Century Aluminum vs. Commercial Metals | Century Aluminum vs. Steel Dynamics | Century Aluminum vs. Reliance Steel Aluminum |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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