Correlation Between COMBA TELECOM and CarMax
Can any of the company-specific risk be diversified away by investing in both COMBA TELECOM and CarMax 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 CarMax 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 CarMax Inc, you can compare the effects of market volatilities on COMBA TELECOM and CarMax 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 CarMax. Check out your portfolio center. Please also check ongoing floating volatility patterns of COMBA TELECOM and CarMax.
Diversification Opportunities for COMBA TELECOM and CarMax
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between COMBA and CarMax is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding COMBA TELECOM SYST and CarMax Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CarMax Inc 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 CarMax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CarMax Inc has no effect on the direction of COMBA TELECOM i.e., COMBA TELECOM and CarMax go up and down completely randomly.
Pair Corralation between COMBA TELECOM and CarMax
Assuming the 90 days trading horizon COMBA TELECOM SYST is expected to under-perform the CarMax. But the stock apears to be less risky and, when comparing its historical volatility, COMBA TELECOM SYST is 1.34 times less risky than CarMax. The stock trades about -0.21 of its potential returns per unit of risk. The CarMax Inc is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 6,590 in CarMax Inc on September 4, 2024 and sell it today you would earn a total of 1,336 from holding CarMax Inc or generate 20.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COMBA TELECOM SYST vs. CarMax Inc
Performance |
| Timeline |
| COMBA TELECOM SYST |
| CarMax Inc |
COMBA TELECOM and CarMax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COMBA TELECOM and CarMax
The main advantage of trading using opposite COMBA TELECOM and CarMax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COMBA TELECOM position performs unexpectedly, CarMax 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 CarMax will offset losses from the drop in CarMax's long position.| COMBA TELECOM vs. TOTAL GABON | COMBA TELECOM vs. Walgreens Boots Alliance | COMBA TELECOM vs. Peak Resources Limited |
| CarMax vs. COMBA TELECOM SYST | CarMax vs. AM EAGLE OUTFITTERS | CarMax vs. Performance Food Group | CarMax vs. Gamma Communications plc |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |