Correlation Between Cummins and Natures Miracle
Can any of the company-specific risk be diversified away by investing in both Cummins and Natures Miracle 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 Cummins and Natures Miracle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cummins and Natures Miracle Holding, you can compare the effects of market volatilities on Cummins and Natures Miracle 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 Cummins with a short position of Natures Miracle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cummins and Natures Miracle.
Diversification Opportunities for Cummins and Natures Miracle
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cummins and Natures is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cummins and Natures Miracle Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natures Miracle Holding and Cummins 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 Cummins are associated (or correlated) with Natures Miracle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natures Miracle Holding has no effect on the direction of Cummins i.e., Cummins and Natures Miracle go up and down completely randomly.
Pair Corralation between Cummins and Natures Miracle
If you would invest 27,094 in Cummins on November 28, 2024 and sell it today you would earn a total of 9,011 from holding Cummins or generate 33.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Cummins vs. Natures Miracle Holding
Performance |
| Timeline |
| Cummins |
| Natures Miracle Holding |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Cummins and Natures Miracle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cummins and Natures Miracle
The main advantage of trading using opposite Cummins and Natures Miracle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cummins position performs unexpectedly, Natures Miracle 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 Natures Miracle will offset losses from the drop in Natures Miracle's long position.The idea behind Cummins and Natures Miracle Holding pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Natures Miracle vs. World Houseware Limited | Natures Miracle vs. Estee Lauder Companies | Natures Miracle vs. Titan International | Natures Miracle vs. Skechers USA |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Stocks Directory Find actively traded stocks across global markets | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |