Correlation Between Comanche International and CPR Gomu
Can any of the company-specific risk be diversified away by investing in both Comanche International and CPR Gomu 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 Comanche International and CPR Gomu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comanche International Public and CPR Gomu Industrial, you can compare the effects of market volatilities on Comanche International and CPR Gomu 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 Comanche International with a short position of CPR Gomu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comanche International and CPR Gomu.
Diversification Opportunities for Comanche International and CPR Gomu
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Comanche and CPR is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Comanche International Public and CPR Gomu Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CPR Gomu Industrial and Comanche International 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 Comanche International Public are associated (or correlated) with CPR Gomu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CPR Gomu Industrial has no effect on the direction of Comanche International i.e., Comanche International and CPR Gomu go up and down completely randomly.
Pair Corralation between Comanche International and CPR Gomu
Assuming the 90 days trading horizon Comanche International Public is expected to under-perform the CPR Gomu. In addition to that, Comanche International is 3.76 times more volatile than CPR Gomu Industrial. It trades about -0.12 of its total potential returns per unit of risk. CPR Gomu Industrial is currently generating about 0.23 per unit of volatility. If you would invest 290.00 in CPR Gomu Industrial on September 4, 2024 and sell it today you would earn a total of 62.00 from holding CPR Gomu Industrial or generate 21.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Comanche International Public vs. CPR Gomu Industrial
Performance |
| Timeline |
| Comanche International |
| CPR Gomu Industrial |
Comanche International and CPR Gomu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comanche International and CPR Gomu
The main advantage of trading using opposite Comanche International and CPR Gomu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comanche International position performs unexpectedly, CPR Gomu 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 CPR Gomu will offset losses from the drop in CPR Gomu's long position.| Comanche International vs. Com7 PCL | Comanche International vs. Central Retail | Comanche International vs. Dohome Public | Comanche International vs. Bangkok Chain Hospital |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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