Correlation Between Core Molding and Crown Electrokinetics
Can any of the company-specific risk be diversified away by investing in both Core Molding and Crown Electrokinetics 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 Core Molding and Crown Electrokinetics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Core Molding Technologies and Crown Electrokinetics Corp, you can compare the effects of market volatilities on Core Molding and Crown Electrokinetics 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 Core Molding with a short position of Crown Electrokinetics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Core Molding and Crown Electrokinetics.
Diversification Opportunities for Core Molding and Crown Electrokinetics
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Core and Crown is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Core Molding Technologies and Crown Electrokinetics Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crown Electrokinetics and Core Molding 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 Core Molding Technologies are associated (or correlated) with Crown Electrokinetics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crown Electrokinetics has no effect on the direction of Core Molding i.e., Core Molding and Crown Electrokinetics go up and down completely randomly.
Pair Corralation between Core Molding and Crown Electrokinetics
Considering the 90-day investment horizon Core Molding Technologies is expected to under-perform the Crown Electrokinetics. But the stock apears to be less risky and, when comparing its historical volatility, Core Molding Technologies is 8.0 times less risky than Crown Electrokinetics. The stock trades about -0.21 of its potential returns per unit of risk. The Crown Electrokinetics Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Crown Electrokinetics Corp on October 24, 2024 and sell it today you would lose (2.00) from holding Crown Electrokinetics Corp or give up 15.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Core Molding Technologies vs. Crown Electrokinetics Corp
Performance |
| Timeline |
| Core Molding Technologies |
| Crown Electrokinetics |
Core Molding and Crown Electrokinetics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Core Molding and Crown Electrokinetics
The main advantage of trading using opposite Core Molding and Crown Electrokinetics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Core Molding position performs unexpectedly, Crown Electrokinetics 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 Crown Electrokinetics will offset losses from the drop in Crown Electrokinetics' long position.| Core Molding vs. Innospec | Core Molding vs. H B Fuller | Core Molding vs. Quaker Chemical | Core Molding vs. Minerals Technologies |
| Crown Electrokinetics vs. Coroware | Crown Electrokinetics vs. Loop Industries | Crown Electrokinetics vs. Hudson Technologies | Crown Electrokinetics vs. General Environmental Management |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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