Correlation Between Core Molding and Sincerity Applied
Can any of the company-specific risk be diversified away by investing in both Core Molding and Sincerity Applied 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 Sincerity Applied 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 Sincerity Applied Materials, you can compare the effects of market volatilities on Core Molding and Sincerity Applied 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 Sincerity Applied. Check out your portfolio center. Please also check ongoing floating volatility patterns of Core Molding and Sincerity Applied.
Diversification Opportunities for Core Molding and Sincerity Applied
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Core and Sincerity is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Core Molding Technologies and Sincerity Applied Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sincerity Applied 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 Sincerity Applied. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sincerity Applied has no effect on the direction of Core Molding i.e., Core Molding and Sincerity Applied go up and down completely randomly.
Pair Corralation between Core Molding and Sincerity Applied
Considering the 90-day investment horizon Core Molding is expected to generate 1.21 times less return on investment than Sincerity Applied. But when comparing it to its historical volatility, Core Molding Technologies is 2.8 times less risky than Sincerity Applied. It trades about 0.1 of its potential returns per unit of risk. Sincerity Applied Materials is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 0.13 in Sincerity Applied Materials on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Sincerity Applied Materials or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Core Molding Technologies vs. Sincerity Applied Materials
Performance |
| Timeline |
| Core Molding Technologies |
| Sincerity Applied |
Core Molding and Sincerity Applied Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Core Molding and Sincerity Applied
The main advantage of trading using opposite Core Molding and Sincerity Applied positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Core Molding position performs unexpectedly, Sincerity Applied 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 Sincerity Applied will offset losses from the drop in Sincerity Applied's long position.| Core Molding vs. Innospec | Core Molding vs. H B Fuller | Core Molding vs. Quaker Chemical | Core Molding vs. Minerals Technologies |
| Sincerity Applied vs. Crown Electrokinetics Corp | Sincerity Applied vs. General Environmental Management | Sincerity Applied vs. Core Molding Technologies | Sincerity Applied vs. Balchem |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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