Correlation Between CAP LEASE and Roebuck Food
Can any of the company-specific risk be diversified away by investing in both CAP LEASE and Roebuck Food 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 CAP LEASE and Roebuck Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CAP LEASE AVIATION and Roebuck Food Group, you can compare the effects of market volatilities on CAP LEASE and Roebuck Food 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 CAP LEASE with a short position of Roebuck Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAP LEASE and Roebuck Food.
Diversification Opportunities for CAP LEASE and Roebuck Food
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CAP and Roebuck is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding CAP LEASE AVIATION and Roebuck Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roebuck Food Group and CAP LEASE 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 CAP LEASE AVIATION are associated (or correlated) with Roebuck Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roebuck Food Group has no effect on the direction of CAP LEASE i.e., CAP LEASE and Roebuck Food go up and down completely randomly.
Pair Corralation between CAP LEASE and Roebuck Food
Assuming the 90 days trading horizon CAP LEASE AVIATION is expected to under-perform the Roebuck Food. In addition to that, CAP LEASE is 1.59 times more volatile than Roebuck Food Group. It trades about -0.03 of its total potential returns per unit of risk. Roebuck Food Group is currently generating about 0.04 per unit of volatility. If you would invest 1,300 in Roebuck Food Group on September 2, 2024 and sell it today you would earn a total of 380.00 from holding Roebuck Food Group or generate 29.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 91.78% |
| Values | Daily Returns |
CAP LEASE AVIATION vs. Roebuck Food Group
Performance |
| Timeline |
| CAP LEASE AVIATION |
| Roebuck Food Group |
CAP LEASE and Roebuck Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CAP LEASE and Roebuck Food
The main advantage of trading using opposite CAP LEASE and Roebuck Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAP LEASE position performs unexpectedly, Roebuck Food 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 Roebuck Food will offset losses from the drop in Roebuck Food's long position.| CAP LEASE vs. Global Net Lease | CAP LEASE vs. Neometals | CAP LEASE vs. Jacquet Metal Service | CAP LEASE vs. GreenX Metals |
| Roebuck Food vs. Toyota Motor Corp | Roebuck Food vs. SoftBank Group Corp | Roebuck Food vs. OTP Bank Nyrt | Roebuck Food vs. Las Vegas Sands |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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