Correlation Between Cetus Capital and Timken
Can any of the company-specific risk be diversified away by investing in both Cetus Capital and Timken 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 Cetus Capital and Timken into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cetus Capital Acquisition and Timken Company, you can compare the effects of market volatilities on Cetus Capital and Timken 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 Cetus Capital with a short position of Timken. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cetus Capital and Timken.
Diversification Opportunities for Cetus Capital and Timken
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cetus and Timken is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Cetus Capital Acquisition and Timken Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Timken Company and Cetus Capital 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 Cetus Capital Acquisition are associated (or correlated) with Timken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Timken Company has no effect on the direction of Cetus Capital i.e., Cetus Capital and Timken go up and down completely randomly.
Pair Corralation between Cetus Capital and Timken
Given the investment horizon of 90 days Cetus Capital Acquisition is expected to generate 30.62 times more return on investment than Timken. However, Cetus Capital is 30.62 times more volatile than Timken Company. It trades about 0.07 of its potential returns per unit of risk. Timken Company is currently generating about 0.02 per unit of risk. If you would invest 0.00 in Cetus Capital Acquisition on September 5, 2024 and sell it today you would earn a total of 1,141 from holding Cetus Capital Acquisition or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 69.29% |
| Values | Daily Returns |
Cetus Capital Acquisition vs. Timken Company
Performance |
| Timeline |
| Cetus Capital Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Timken Company |
Cetus Capital and Timken Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cetus Capital and Timken
The main advantage of trading using opposite Cetus Capital and Timken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cetus Capital position performs unexpectedly, Timken 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 Timken will offset losses from the drop in Timken's long position.| Cetus Capital vs. ServiceNow | Cetus Capital vs. Minerals Technologies | Cetus Capital vs. Nike Inc | Cetus Capital vs. Uber Technologies |
| Timken vs. AB SKF | Timken vs. Aquagold International | Timken vs. Thrivent High Yield | Timken vs. Morningstar Unconstrained Allocation |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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