Correlation Between CIM FINANCIAL and AFRICA CLEAN
Can any of the company-specific risk be diversified away by investing in both CIM FINANCIAL and AFRICA CLEAN 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 CIM FINANCIAL and AFRICA CLEAN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CIM FINANCIAL SERVICES and AFRICA CLEAN ENERGY, you can compare the effects of market volatilities on CIM FINANCIAL and AFRICA CLEAN 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 CIM FINANCIAL with a short position of AFRICA CLEAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of CIM FINANCIAL and AFRICA CLEAN.
Diversification Opportunities for CIM FINANCIAL and AFRICA CLEAN
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CIM and AFRICA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CIM FINANCIAL SERVICES and AFRICA CLEAN ENERGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AFRICA CLEAN ENERGY and CIM FINANCIAL 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 CIM FINANCIAL SERVICES are associated (or correlated) with AFRICA CLEAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AFRICA CLEAN ENERGY has no effect on the direction of CIM FINANCIAL i.e., CIM FINANCIAL and AFRICA CLEAN go up and down completely randomly.
Pair Corralation between CIM FINANCIAL and AFRICA CLEAN
If you would invest 1,300 in CIM FINANCIAL SERVICES on October 25, 2024 and sell it today you would earn a total of 140.00 from holding CIM FINANCIAL SERVICES or generate 10.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CIM FINANCIAL SERVICES vs. AFRICA CLEAN ENERGY
Performance |
| Timeline |
| CIM FINANCIAL SERVICES |
| AFRICA CLEAN ENERGY |
CIM FINANCIAL and AFRICA CLEAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CIM FINANCIAL and AFRICA CLEAN
The main advantage of trading using opposite CIM FINANCIAL and AFRICA CLEAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CIM FINANCIAL position performs unexpectedly, AFRICA CLEAN 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 AFRICA CLEAN will offset losses from the drop in AFRICA CLEAN's long position.| CIM FINANCIAL vs. FINCORP INVESTMENT LTD | CIM FINANCIAL vs. ELITE MEAT PROCESSORS | CIM FINANCIAL vs. ASTORIA INVESTMENT LTD | CIM FINANCIAL vs. AFREXIMBANK |
| AFRICA CLEAN vs. FINCORP INVESTMENT LTD | AFRICA CLEAN vs. ELITE MEAT PROCESSORS | AFRICA CLEAN vs. HOTELEST LTD | AFRICA CLEAN vs. CIM FINANCIAL SERVICES |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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