Correlation Between Clime Investment and COAST ENTERTAINMENT
Can any of the company-specific risk be diversified away by investing in both Clime Investment and COAST ENTERTAINMENT 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 Clime Investment and COAST ENTERTAINMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clime Investment Management and COAST ENTERTAINMENT HOLDINGS, you can compare the effects of market volatilities on Clime Investment and COAST ENTERTAINMENT 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 Clime Investment with a short position of COAST ENTERTAINMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clime Investment and COAST ENTERTAINMENT.
Diversification Opportunities for Clime Investment and COAST ENTERTAINMENT
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Clime and COAST is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Clime Investment Management and COAST ENTERTAINMENT HOLDINGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COAST ENTERTAINMENT and Clime Investment 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 Clime Investment Management are associated (or correlated) with COAST ENTERTAINMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COAST ENTERTAINMENT has no effect on the direction of Clime Investment i.e., Clime Investment and COAST ENTERTAINMENT go up and down completely randomly.
Pair Corralation between Clime Investment and COAST ENTERTAINMENT
Assuming the 90 days trading horizon Clime Investment Management is expected to generate 0.85 times more return on investment than COAST ENTERTAINMENT. However, Clime Investment Management is 1.17 times less risky than COAST ENTERTAINMENT. It trades about 0.25 of its potential returns per unit of risk. COAST ENTERTAINMENT HOLDINGS is currently generating about 0.01 per unit of risk. If you would invest 36.00 in Clime Investment Management on November 5, 2024 and sell it today you would earn a total of 3.00 from holding Clime Investment Management or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clime Investment Management vs. COAST ENTERTAINMENT HOLDINGS
Performance |
| Timeline |
| Clime Investment Man |
| COAST ENTERTAINMENT |
Clime Investment and COAST ENTERTAINMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clime Investment and COAST ENTERTAINMENT
The main advantage of trading using opposite Clime Investment and COAST ENTERTAINMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clime Investment position performs unexpectedly, COAST ENTERTAINMENT 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 COAST ENTERTAINMENT will offset losses from the drop in COAST ENTERTAINMENT's long position.| Clime Investment vs. Aussie Broadband | Clime Investment vs. EROAD | Clime Investment vs. Mirrabooka Investments | Clime Investment vs. Arc Funds |
| COAST ENTERTAINMENT vs. Carnegie Clean Energy | COAST ENTERTAINMENT vs. Zoom2u Technologies | COAST ENTERTAINMENT vs. Maggie Beer Holdings | COAST ENTERTAINMENT vs. Anteris Technologies |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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