Correlation Between COMBA TELECOM and Alfa Financial
Can any of the company-specific risk be diversified away by investing in both COMBA TELECOM and Alfa Financial 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 COMBA TELECOM and Alfa Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COMBA TELECOM SYST and Alfa Financial Software, you can compare the effects of market volatilities on COMBA TELECOM and Alfa Financial 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 COMBA TELECOM with a short position of Alfa Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of COMBA TELECOM and Alfa Financial.
Diversification Opportunities for COMBA TELECOM and Alfa Financial
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between COMBA and Alfa is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding COMBA TELECOM SYST and Alfa Financial Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfa Financial Software and COMBA TELECOM 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 COMBA TELECOM SYST are associated (or correlated) with Alfa Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfa Financial Software has no effect on the direction of COMBA TELECOM i.e., COMBA TELECOM and Alfa Financial go up and down completely randomly.
Pair Corralation between COMBA TELECOM and Alfa Financial
Assuming the 90 days trading horizon COMBA TELECOM SYST is expected to under-perform the Alfa Financial. But the stock apears to be less risky and, when comparing its historical volatility, COMBA TELECOM SYST is 1.1 times less risky than Alfa Financial. The stock trades about -0.01 of its potential returns per unit of risk. The Alfa Financial Software is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 168.00 in Alfa Financial Software on August 28, 2024 and sell it today you would earn a total of 84.00 from holding Alfa Financial Software or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COMBA TELECOM SYST vs. Alfa Financial Software
Performance |
| Timeline |
| COMBA TELECOM SYST |
| Alfa Financial Software |
COMBA TELECOM and Alfa Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COMBA TELECOM and Alfa Financial
The main advantage of trading using opposite COMBA TELECOM and Alfa Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COMBA TELECOM position performs unexpectedly, Alfa Financial 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 Alfa Financial will offset losses from the drop in Alfa Financial's long position.| COMBA TELECOM vs. Apple Inc | COMBA TELECOM vs. Apple Inc | COMBA TELECOM vs. Apple Inc | COMBA TELECOM vs. Microsoft |
| Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |