Correlation Between Comba Telecom and Collins Foods
Can any of the company-specific risk be diversified away by investing in both Comba Telecom and Collins Foods 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 Collins Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comba Telecom Systems and Collins Foods Limited, you can compare the effects of market volatilities on Comba Telecom and Collins Foods 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 Collins Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comba Telecom and Collins Foods.
Diversification Opportunities for Comba Telecom and Collins Foods
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Comba and Collins is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Comba Telecom Systems and Collins Foods Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Collins Foods Limited 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 Systems are associated (or correlated) with Collins Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Collins Foods Limited has no effect on the direction of Comba Telecom i.e., Comba Telecom and Collins Foods go up and down completely randomly.
Pair Corralation between Comba Telecom and Collins Foods
Assuming the 90 days trading horizon Comba Telecom Systems is expected to generate 2.43 times more return on investment than Collins Foods. However, Comba Telecom is 2.43 times more volatile than Collins Foods Limited. It trades about 0.02 of its potential returns per unit of risk. Collins Foods Limited is currently generating about 0.01 per unit of risk. If you would invest 14.00 in Comba Telecom Systems on October 1, 2024 and sell it today you would earn a total of 0.00 from holding Comba Telecom Systems or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Comba Telecom Systems vs. Collins Foods Limited
Performance |
| Timeline |
| Comba Telecom Systems |
| Collins Foods Limited |
Comba Telecom and Collins Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comba Telecom and Collins Foods
The main advantage of trading using opposite Comba Telecom and Collins Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comba Telecom position performs unexpectedly, Collins Foods 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 Collins Foods will offset losses from the drop in Collins Foods' long position.| Comba Telecom vs. QINGCI GAMES INC | Comba Telecom vs. GigaMedia | Comba Telecom vs. Games Workshop Group | Comba Telecom vs. Xinhua Winshare Publishing |
| Collins Foods vs. INFORMATION SVC GRP | Collins Foods vs. Microchip Technology Incorporated | Collins Foods vs. Check Point Software | Collins Foods vs. Sunny Optical Technology |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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