Correlation Between Coor Service and Webster Financial
Can any of the company-specific risk be diversified away by investing in both Coor Service and Webster 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 Coor Service and Webster Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coor Service Management and Webster Financial, you can compare the effects of market volatilities on Coor Service and Webster 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 Coor Service with a short position of Webster Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coor Service and Webster Financial.
Diversification Opportunities for Coor Service and Webster Financial
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Coor and Webster is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Coor Service Management and Webster Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Webster Financial and Coor Service 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 Coor Service Management are associated (or correlated) with Webster Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Webster Financial has no effect on the direction of Coor Service i.e., Coor Service and Webster Financial go up and down completely randomly.
Pair Corralation between Coor Service and Webster Financial
Assuming the 90 days horizon Coor Service Management is expected to generate 1.6 times more return on investment than Webster Financial. However, Coor Service is 1.6 times more volatile than Webster Financial. It trades about 0.18 of its potential returns per unit of risk. Webster Financial is currently generating about -0.42 per unit of risk. If you would invest 278.00 in Coor Service Management on December 9, 2024 and sell it today you would earn a total of 33.00 from holding Coor Service Management or generate 11.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coor Service Management vs. Webster Financial
Performance |
| Timeline |
| Coor Service Management |
| Webster Financial |
Coor Service and Webster Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coor Service and Webster Financial
The main advantage of trading using opposite Coor Service and Webster Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coor Service position performs unexpectedly, Webster 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 Webster Financial will offset losses from the drop in Webster Financial's long position.| Coor Service vs. AviChina Industry Technology | Coor Service vs. Kaufman Broad SA | Coor Service vs. Easy Software AG | Coor Service vs. GOLD ROAD RES |
| Webster Financial vs. NORDHEALTH AS NK | Webster Financial vs. CLOVER HEALTH INV | Webster Financial vs. UNIVERSAL DISPLAY | Webster Financial vs. Bumrungrad Hospital Public |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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