Correlation Between Carlyle and ClimateRock
Can any of the company-specific risk be diversified away by investing in both Carlyle and ClimateRock 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 Carlyle and ClimateRock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carlyle Group and ClimateRock Class A, you can compare the effects of market volatilities on Carlyle and ClimateRock 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 Carlyle with a short position of ClimateRock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlyle and ClimateRock.
Diversification Opportunities for Carlyle and ClimateRock
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Carlyle and ClimateRock is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Carlyle Group and ClimateRock Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ClimateRock Class and Carlyle 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 Carlyle Group are associated (or correlated) with ClimateRock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ClimateRock Class has no effect on the direction of Carlyle i.e., Carlyle and ClimateRock go up and down completely randomly.
Pair Corralation between Carlyle and ClimateRock
Allowing for the 90-day total investment horizon Carlyle Group is expected to generate 3.33 times more return on investment than ClimateRock. However, Carlyle is 3.33 times more volatile than ClimateRock Class A. It trades about 0.07 of its potential returns per unit of risk. ClimateRock Class A is currently generating about 0.05 per unit of risk. If you would invest 2,874 in Carlyle Group on August 28, 2024 and sell it today you would earn a total of 2,565 from holding Carlyle Group or generate 89.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Carlyle Group vs. ClimateRock Class A
Performance |
| Timeline |
| Carlyle Group |
| ClimateRock Class |
Carlyle and ClimateRock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlyle and ClimateRock
The main advantage of trading using opposite Carlyle and ClimateRock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlyle position performs unexpectedly, ClimateRock 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 ClimateRock will offset losses from the drop in ClimateRock's long position.| Carlyle vs. Aurora Innovation | Carlyle vs. HUMANA INC | Carlyle vs. Aquagold International | Carlyle vs. Barloworld Ltd ADR |
| ClimateRock vs. AlphaVest Acquisition Corp | ClimateRock vs. Golden Star Acquisition | ClimateRock vs. Alpha One | ClimateRock vs. Manaris Corp |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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