Correlation Between Curtiss Motorcycles and Curtis Mathes
Can any of the company-specific risk be diversified away by investing in both Curtiss Motorcycles and Curtis Mathes 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 Curtiss Motorcycles and Curtis Mathes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Curtiss Motorcycles and Curtis Mathes Corp, you can compare the effects of market volatilities on Curtiss Motorcycles and Curtis Mathes 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 Curtiss Motorcycles with a short position of Curtis Mathes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Curtiss Motorcycles and Curtis Mathes.
Diversification Opportunities for Curtiss Motorcycles and Curtis Mathes
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Curtiss and Curtis is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Curtiss Motorcycles and Curtis Mathes Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Curtis Mathes Corp and Curtiss Motorcycles 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 Curtiss Motorcycles are associated (or correlated) with Curtis Mathes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Curtis Mathes Corp has no effect on the direction of Curtiss Motorcycles i.e., Curtiss Motorcycles and Curtis Mathes go up and down completely randomly.
Pair Corralation between Curtiss Motorcycles and Curtis Mathes
Given the investment horizon of 90 days Curtiss Motorcycles is expected to generate 1.14 times more return on investment than Curtis Mathes. However, Curtiss Motorcycles is 1.14 times more volatile than Curtis Mathes Corp. It trades about -0.01 of its potential returns per unit of risk. Curtis Mathes Corp is currently generating about -0.22 per unit of risk. If you would invest 2.80 in Curtiss Motorcycles on September 4, 2024 and sell it today you would lose (0.50) from holding Curtiss Motorcycles or give up 17.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Curtiss Motorcycles vs. Curtis Mathes Corp
Performance |
| Timeline |
| Curtiss Motorcycles |
| Curtis Mathes Corp |
Curtiss Motorcycles and Curtis Mathes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Curtiss Motorcycles and Curtis Mathes
The main advantage of trading using opposite Curtiss Motorcycles and Curtis Mathes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Curtiss Motorcycles position performs unexpectedly, Curtis Mathes 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 Curtis Mathes will offset losses from the drop in Curtis Mathes' long position.| Curtiss Motorcycles vs. Life Electric Vehicles | Curtiss Motorcycles vs. Evil Empire Designs | Curtiss Motorcycles vs. Twin Vee Powercats | Curtiss Motorcycles vs. LCI Industries |
| Curtis Mathes vs. Ensurge Micropower ASA | Curtis Mathes vs. Curtiss Motorcycles | Curtis Mathes vs. Trutankless | Curtis Mathes vs. Clean Energy Pathway |
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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