Correlation Between Coty and Space Communication
Can any of the company-specific risk be diversified away by investing in both Coty and Space Communication 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 Space Communication into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coty Inc and Space Communication, you can compare the effects of market volatilities on Coty and Space Communication 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 Space Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coty and Space Communication.
Diversification Opportunities for Coty and Space Communication
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coty and Space is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Coty Inc and Space Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Space Communication 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 Space Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Space Communication has no effect on the direction of Coty i.e., Coty and Space Communication go up and down completely randomly.
Pair Corralation between Coty and Space Communication
If you would invest 707.00 in Coty Inc on October 23, 2024 and sell it today you would earn a total of 7.00 from holding Coty Inc or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Coty Inc vs. Space Communication
Performance |
| Timeline |
| Coty Inc |
| Space Communication |
Coty and Space Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coty and Space Communication
The main advantage of trading using opposite Coty and Space Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coty position performs unexpectedly, Space Communication 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 Space Communication will offset losses from the drop in Space Communication's long position.The idea behind Coty Inc and Space Communication 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.| Space Communication vs. Westinghouse Air Brake | Space Communication vs. EvoAir Holdings | Space Communication vs. Proficient Auto Logistics, | Space Communication vs. Alaska Air Group |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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