Correlation Between Coty and Iridium World
Can any of the company-specific risk be diversified away by investing in both Coty and Iridium World 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 Coty and Iridium World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coty Inc and Iridium World Communications, you can compare the effects of market volatilities on Coty and Iridium World 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 Coty with a short position of Iridium World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coty and Iridium World.
Diversification Opportunities for Coty and Iridium World
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coty and Iridium is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Coty Inc and Iridium World Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iridium World Commun and Coty 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 Coty Inc are associated (or correlated) with Iridium World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iridium World Commun has no effect on the direction of Coty i.e., Coty and Iridium World go up and down completely randomly.
Pair Corralation between Coty and Iridium World
If you would invest (100.00) in Iridium World Communications on September 4, 2024 and sell it today you would earn a total of 100.00 from holding Iridium World Communications or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Coty Inc vs. Iridium World Communications
Performance |
| Timeline |
| Coty Inc |
| Iridium World Commun |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Coty and Iridium World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coty and Iridium World
The main advantage of trading using opposite Coty and Iridium World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coty position performs unexpectedly, Iridium World 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 Iridium World will offset losses from the drop in Iridium World's long position.The idea behind Coty Inc and Iridium World Communications pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Iridium World vs. Tradeweb Markets | Iridium World vs. Summit Environmental | Iridium World vs. Western Asset Investment | Iridium World vs. Bank of America |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |