Correlation Between CIM FINANCIAL and MAURITIUS CHEMICAL
Can any of the company-specific risk be diversified away by investing in both CIM FINANCIAL and MAURITIUS CHEMICAL 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 MAURITIUS CHEMICAL 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 MAURITIUS CHEMICAL FERTILIZER, you can compare the effects of market volatilities on CIM FINANCIAL and MAURITIUS CHEMICAL 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 MAURITIUS CHEMICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of CIM FINANCIAL and MAURITIUS CHEMICAL.
Diversification Opportunities for CIM FINANCIAL and MAURITIUS CHEMICAL
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between CIM and MAURITIUS is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding CIM FINANCIAL SERVICES and MAURITIUS CHEMICAL FERTILIZER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAURITIUS CHEMICAL 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 MAURITIUS CHEMICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAURITIUS CHEMICAL has no effect on the direction of CIM FINANCIAL i.e., CIM FINANCIAL and MAURITIUS CHEMICAL go up and down completely randomly.
Pair Corralation between CIM FINANCIAL and MAURITIUS CHEMICAL
Assuming the 90 days trading horizon CIM FINANCIAL is expected to generate 1.23 times less return on investment than MAURITIUS CHEMICAL. But when comparing it to its historical volatility, CIM FINANCIAL SERVICES is 1.92 times less risky than MAURITIUS CHEMICAL. It trades about 0.07 of its potential returns per unit of risk. MAURITIUS CHEMICAL FERTILIZER is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 652.00 in MAURITIUS CHEMICAL FERTILIZER on September 12, 2024 and sell it today you would earn a total of 148.00 from holding MAURITIUS CHEMICAL FERTILIZER or generate 22.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.76% |
| Values | Daily Returns |
CIM FINANCIAL SERVICES vs. MAURITIUS CHEMICAL FERTILIZER
Performance |
| Timeline |
| CIM FINANCIAL SERVICES |
| MAURITIUS CHEMICAL |
CIM FINANCIAL and MAURITIUS CHEMICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CIM FINANCIAL and MAURITIUS CHEMICAL
The main advantage of trading using opposite CIM FINANCIAL and MAURITIUS CHEMICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CIM FINANCIAL position performs unexpectedly, MAURITIUS CHEMICAL 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 MAURITIUS CHEMICAL will offset losses from the drop in MAURITIUS CHEMICAL's long position.| CIM FINANCIAL vs. FINCORP INVESTMENT LTD | CIM FINANCIAL vs. LOTTOTECH LTD | CIM FINANCIAL vs. LUX ISLAND RESORTS | CIM FINANCIAL vs. PSG FINANCIAL SERVICES |
| MAURITIUS CHEMICAL vs. BEAU VALLON HOSPITAL | MAURITIUS CHEMICAL vs. AFRICA CLEAN ENERGY | MAURITIUS CHEMICAL vs. ASTORIA INVESTMENT LTD | MAURITIUS CHEMICAL vs. PLASTIC INDUSTRY LTD |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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