Correlation Between CAP LEASE and SupplyMe Capital
Can any of the company-specific risk be diversified away by investing in both CAP LEASE and SupplyMe Capital 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 SupplyMe Capital 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 SupplyMe Capital PLC, you can compare the effects of market volatilities on CAP LEASE and SupplyMe Capital 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 SupplyMe Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAP LEASE and SupplyMe Capital.
Diversification Opportunities for CAP LEASE and SupplyMe Capital
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CAP and SupplyMe is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding CAP LEASE AVIATION and SupplyMe Capital PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SupplyMe Capital PLC 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 SupplyMe Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SupplyMe Capital PLC has no effect on the direction of CAP LEASE i.e., CAP LEASE and SupplyMe Capital go up and down completely randomly.
Pair Corralation between CAP LEASE and SupplyMe Capital
Assuming the 90 days trading horizon CAP LEASE AVIATION is expected to generate 0.37 times more return on investment than SupplyMe Capital. However, CAP LEASE AVIATION is 2.69 times less risky than SupplyMe Capital. It trades about -0.03 of its potential returns per unit of risk. SupplyMe Capital PLC is currently generating about -0.04 per unit of risk. If you would invest 100.00 in CAP LEASE AVIATION on September 4, 2024 and sell it today you would lose (52.00) from holding CAP LEASE AVIATION or give up 52.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 92.17% |
| Values | Daily Returns |
CAP LEASE AVIATION vs. SupplyMe Capital PLC
Performance |
| Timeline |
| CAP LEASE AVIATION |
| SupplyMe Capital PLC |
CAP LEASE and SupplyMe Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CAP LEASE and SupplyMe Capital
The main advantage of trading using opposite CAP LEASE and SupplyMe Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAP LEASE position performs unexpectedly, SupplyMe Capital 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 SupplyMe Capital will offset losses from the drop in SupplyMe Capital's long position.| CAP LEASE vs. Associated British Foods | CAP LEASE vs. Tyson Foods Cl | CAP LEASE vs. Roebuck Food Group | CAP LEASE vs. Various Eateries PLC |
| SupplyMe Capital vs. Alior Bank SA | SupplyMe Capital vs. Sparebank 1 SR | SupplyMe Capital vs. Veolia Environnement VE | SupplyMe Capital vs. CAP LEASE AVIATION |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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