Correlation Between CIA ENGER and KYUSHU EL
Can any of the company-specific risk be diversified away by investing in both CIA ENGER and KYUSHU EL 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 CIA ENGER and KYUSHU EL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CIA ENGER ADR and KYUSHU EL PWR, you can compare the effects of market volatilities on CIA ENGER and KYUSHU EL 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 CIA ENGER with a short position of KYUSHU EL. Check out your portfolio center. Please also check ongoing floating volatility patterns of CIA ENGER and KYUSHU EL.
Diversification Opportunities for CIA ENGER and KYUSHU EL
Excellent diversification
The 3 months correlation between CIA and KYUSHU is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding CIA ENGER ADR and KYUSHU EL PWR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KYUSHU EL PWR and CIA ENGER 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 CIA ENGER ADR are associated (or correlated) with KYUSHU EL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KYUSHU EL PWR has no effect on the direction of CIA ENGER i.e., CIA ENGER and KYUSHU EL go up and down completely randomly.
Pair Corralation between CIA ENGER and KYUSHU EL
Assuming the 90 days trading horizon CIA ENGER ADR is expected to generate 0.7 times more return on investment than KYUSHU EL. However, CIA ENGER ADR is 1.43 times less risky than KYUSHU EL. It trades about 0.04 of its potential returns per unit of risk. KYUSHU EL PWR is currently generating about -0.05 per unit of risk. If you would invest 204.00 in CIA ENGER ADR on November 2, 2024 and sell it today you would earn a total of 10.00 from holding CIA ENGER ADR or generate 4.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.04% |
| Values | Daily Returns |
CIA ENGER ADR vs. KYUSHU EL PWR
Performance |
| Timeline |
| CIA ENGER ADR |
| KYUSHU EL PWR |
CIA ENGER and KYUSHU EL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CIA ENGER and KYUSHU EL
The main advantage of trading using opposite CIA ENGER and KYUSHU EL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CIA ENGER position performs unexpectedly, KYUSHU EL 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 KYUSHU EL will offset losses from the drop in KYUSHU EL's long position.| CIA ENGER vs. Inspire Medical Systems | CIA ENGER vs. MAGNUM MINING EXP | CIA ENGER vs. Globex Mining Enterprises | CIA ENGER vs. GALENA MINING LTD |
| KYUSHU EL vs. Scottish Mortgage Investment | KYUSHU EL vs. PRECISION DRILLING P | KYUSHU EL vs. Urban Outfitters | KYUSHU EL vs. URBAN OUTFITTERS |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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