Correlation Between CK Hutchison and Compass Diversified
Can any of the company-specific risk be diversified away by investing in both CK Hutchison and Compass Diversified 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 CK Hutchison and Compass Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CK Hutchison Holdings and Compass Diversified Holdings, you can compare the effects of market volatilities on CK Hutchison and Compass Diversified 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 CK Hutchison with a short position of Compass Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of CK Hutchison and Compass Diversified.
Diversification Opportunities for CK Hutchison and Compass Diversified
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CKHUY and Compass is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding CK Hutchison Holdings and Compass Diversified Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compass Diversified and CK Hutchison 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 CK Hutchison Holdings are associated (or correlated) with Compass Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compass Diversified has no effect on the direction of CK Hutchison i.e., CK Hutchison and Compass Diversified go up and down completely randomly.
Pair Corralation between CK Hutchison and Compass Diversified
Assuming the 90 days horizon CK Hutchison Holdings is expected to under-perform the Compass Diversified. But the pink sheet apears to be less risky and, when comparing its historical volatility, CK Hutchison Holdings is 1.25 times less risky than Compass Diversified. The pink sheet trades about 0.0 of its potential returns per unit of risk. The Compass Diversified Holdings is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,935 in Compass Diversified Holdings on September 3, 2024 and sell it today you would earn a total of 435.00 from holding Compass Diversified Holdings or generate 22.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CK Hutchison Holdings vs. Compass Diversified Holdings
Performance |
| Timeline |
| CK Hutchison Holdings |
| Compass Diversified |
CK Hutchison and Compass Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CK Hutchison and Compass Diversified
The main advantage of trading using opposite CK Hutchison and Compass Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CK Hutchison position performs unexpectedly, Compass Diversified 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 Compass Diversified will offset losses from the drop in Compass Diversified's long position.| CK Hutchison vs. TOMI Environmental Solutions | CK Hutchison vs. SCOR PK | CK Hutchison vs. HUMANA INC | CK Hutchison vs. Aquagold International |
| Compass Diversified vs. Matthews International | Compass Diversified vs. Steel Partners Holdings | Compass Diversified vs. Valmont Industries | Compass Diversified vs. Brookfield Business Partners |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |