Correlation Between COMBA TELECOM and Corporate Office
Can any of the company-specific risk be diversified away by investing in both COMBA TELECOM and Corporate Office 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 Corporate Office 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 Corporate Office Properties, you can compare the effects of market volatilities on COMBA TELECOM and Corporate Office 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 Corporate Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of COMBA TELECOM and Corporate Office.
Diversification Opportunities for COMBA TELECOM and Corporate Office
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between COMBA and Corporate is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding COMBA TELECOM SYST and Corporate Office Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corporate Office Pro 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 Corporate Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corporate Office Pro has no effect on the direction of COMBA TELECOM i.e., COMBA TELECOM and Corporate Office go up and down completely randomly.
Pair Corralation between COMBA TELECOM and Corporate Office
Assuming the 90 days trading horizon COMBA TELECOM SYST is expected to generate 2.67 times more return on investment than Corporate Office. However, COMBA TELECOM is 2.67 times more volatile than Corporate Office Properties. It trades about 0.08 of its potential returns per unit of risk. Corporate Office Properties is currently generating about -0.16 per unit of risk. If you would invest 12.00 in COMBA TELECOM SYST on October 30, 2024 and sell it today you would earn a total of 1.00 from holding COMBA TELECOM SYST or generate 8.33% 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. Corporate Office Properties
Performance |
| Timeline |
| COMBA TELECOM SYST |
| Corporate Office Pro |
COMBA TELECOM and Corporate Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COMBA TELECOM and Corporate Office
The main advantage of trading using opposite COMBA TELECOM and Corporate Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COMBA TELECOM position performs unexpectedly, Corporate Office 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 Corporate Office will offset losses from the drop in Corporate Office's long position.| COMBA TELECOM vs. Summit Hotel Properties | COMBA TELECOM vs. ARDAGH METAL PACDL 0001 | COMBA TELECOM vs. Meli Hotels International | COMBA TELECOM vs. AMAG Austria Metall |
| Corporate Office vs. Japan Tobacco | Corporate Office vs. Brockhaus Capital Management | Corporate Office vs. Tyson Foods | Corporate Office vs. TreeHouse Foods |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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