Correlation Between Comstock Holding and Federal Home
Can any of the company-specific risk be diversified away by investing in both Comstock Holding and Federal Home 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 Comstock Holding and Federal Home into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comstock Holding Companies and Federal Home 530, you can compare the effects of market volatilities on Comstock Holding and Federal Home 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 Comstock Holding with a short position of Federal Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comstock Holding and Federal Home.
Diversification Opportunities for Comstock Holding and Federal Home
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Comstock and Federal is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Comstock Holding Companies and Federal Home 530 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federal Home 530 and Comstock Holding 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 Comstock Holding Companies are associated (or correlated) with Federal Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federal Home 530 has no effect on the direction of Comstock Holding i.e., Comstock Holding and Federal Home go up and down completely randomly.
Pair Corralation between Comstock Holding and Federal Home
Given the investment horizon of 90 days Comstock Holding Companies is expected to under-perform the Federal Home. But the stock apears to be less risky and, when comparing its historical volatility, Comstock Holding Companies is 1.11 times less risky than Federal Home. The stock trades about -0.18 of its potential returns per unit of risk. The Federal Home 530 is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 1,878 in Federal Home 530 on November 27, 2024 and sell it today you would lose (52.00) from holding Federal Home 530 or give up 2.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Comstock Holding Companies vs. Federal Home 530
Performance |
| Timeline |
| Comstock Holding Com |
| Federal Home 530 |
Comstock Holding and Federal Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comstock Holding and Federal Home
The main advantage of trading using opposite Comstock Holding and Federal Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comstock Holding position performs unexpectedly, Federal Home 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 Federal Home will offset losses from the drop in Federal Home's long position.| Comstock Holding vs. St Joe Company | Comstock Holding vs. Stratus Properties | Comstock Holding vs. Mitsui Fudosan Co | Comstock Holding vs. New World Development |
| Federal Home vs. Alto Neuroscience, | Federal Home vs. Tradeweb Markets | Federal Home vs. Paysafe | Federal Home vs. Cedar Realty Trust |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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