Correlation Between Comstock Holding and Sensient Technologies
Can any of the company-specific risk be diversified away by investing in both Comstock Holding and Sensient Technologies 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 Sensient Technologies 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 Sensient Technologies, you can compare the effects of market volatilities on Comstock Holding and Sensient Technologies 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 Sensient Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comstock Holding and Sensient Technologies.
Diversification Opportunities for Comstock Holding and Sensient Technologies
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Comstock and Sensient is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Comstock Holding Companies and Sensient Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sensient Technologies 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 Sensient Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sensient Technologies has no effect on the direction of Comstock Holding i.e., Comstock Holding and Sensient Technologies go up and down completely randomly.
Pair Corralation between Comstock Holding and Sensient Technologies
Given the investment horizon of 90 days Comstock Holding Companies is expected to generate 2.55 times more return on investment than Sensient Technologies. However, Comstock Holding is 2.55 times more volatile than Sensient Technologies. It trades about 0.08 of its potential returns per unit of risk. Sensient Technologies is currently generating about 0.02 per unit of risk. If you would invest 617.00 in Comstock Holding Companies on September 1, 2024 and sell it today you would earn a total of 199.00 from holding Comstock Holding Companies or generate 32.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Comstock Holding Companies vs. Sensient Technologies
Performance |
| Timeline |
| Comstock Holding Com |
| Sensient Technologies |
Comstock Holding and Sensient Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comstock Holding and Sensient Technologies
The main advantage of trading using opposite Comstock Holding and Sensient Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comstock Holding position performs unexpectedly, Sensient Technologies 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 Sensient Technologies will offset losses from the drop in Sensient Technologies' long position.| Comstock Holding vs. Arhaus Inc | Comstock Holding vs. Floor Decor Holdings | Comstock Holding vs. Haverty Furniture Companies | Comstock Holding vs. Kingfisher plc |
| Sensient Technologies vs. Innospec | Sensient Technologies vs. Minerals Technologies | Sensient Technologies vs. Oil Dri | Sensient Technologies vs. H B Fuller |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |