Correlation Between Compa Sibiu and Romcab SA
Can any of the company-specific risk be diversified away by investing in both Compa Sibiu and Romcab SA 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 Compa Sibiu and Romcab SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compa Sibiu and Romcab SA, you can compare the effects of market volatilities on Compa Sibiu and Romcab SA 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 Compa Sibiu with a short position of Romcab SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compa Sibiu and Romcab SA.
Diversification Opportunities for Compa Sibiu and Romcab SA
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Compa and Romcab is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Compa Sibiu and Romcab SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Romcab SA and Compa Sibiu 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 Compa Sibiu are associated (or correlated) with Romcab SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Romcab SA has no effect on the direction of Compa Sibiu i.e., Compa Sibiu and Romcab SA go up and down completely randomly.
Pair Corralation between Compa Sibiu and Romcab SA
Assuming the 90 days trading horizon Compa Sibiu is expected to generate 0.29 times more return on investment than Romcab SA. However, Compa Sibiu is 3.39 times less risky than Romcab SA. It trades about -0.16 of its potential returns per unit of risk. Romcab SA is currently generating about -0.32 per unit of risk. If you would invest 55.00 in Compa Sibiu on August 29, 2024 and sell it today you would lose (3.00) from holding Compa Sibiu or give up 5.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compa Sibiu vs. Romcab SA
Performance |
| Timeline |
| Compa Sibiu |
| Romcab SA |
Compa Sibiu and Romcab SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compa Sibiu and Romcab SA
The main advantage of trading using opposite Compa Sibiu and Romcab SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compa Sibiu position performs unexpectedly, Romcab SA 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 Romcab SA will offset losses from the drop in Romcab SA's long position.| Compa Sibiu vs. IM Vinaria Purcari | Compa Sibiu vs. TRANSILVANIA INVESTMENTS ALLIANCE | Compa Sibiu vs. Evergent Investments SA | Compa Sibiu vs. Safetech Innovations SA |
| Romcab SA vs. GRUPUL INDUSTRIAL ELECTROCONTACT | Romcab SA vs. IHUNT TECHNOLOGY IMPORT EXPORT | Romcab SA vs. Evergent Investments SA | Romcab SA vs. AROBS TRANSILVANIA SOFTWARE |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |