Correlation Between CPR Gomu and 2S Metal
Can any of the company-specific risk be diversified away by investing in both CPR Gomu and 2S Metal 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 CPR Gomu and 2S Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPR Gomu Industrial and 2S Metal Public, you can compare the effects of market volatilities on CPR Gomu and 2S Metal 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 CPR Gomu with a short position of 2S Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPR Gomu and 2S Metal.
Diversification Opportunities for CPR Gomu and 2S Metal
Pay attention - limited upside
The 3 months correlation between CPR and 2S Metal is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding CPR Gomu Industrial and 2S Metal Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 2S Metal Public and CPR Gomu 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 CPR Gomu Industrial are associated (or correlated) with 2S Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 2S Metal Public has no effect on the direction of CPR Gomu i.e., CPR Gomu and 2S Metal go up and down completely randomly.
Pair Corralation between CPR Gomu and 2S Metal
Assuming the 90 days trading horizon CPR Gomu Industrial is expected to generate 2.95 times more return on investment than 2S Metal. However, CPR Gomu is 2.95 times more volatile than 2S Metal Public. It trades about 0.01 of its potential returns per unit of risk. 2S Metal Public is currently generating about 0.02 per unit of risk. If you would invest 376.00 in CPR Gomu Industrial on September 19, 2024 and sell it today you would lose (44.00) from holding CPR Gomu Industrial or give up 11.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CPR Gomu Industrial vs. 2S Metal Public
Performance |
| Timeline |
| CPR Gomu Industrial |
| 2S Metal Public |
CPR Gomu and 2S Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPR Gomu and 2S Metal
The main advantage of trading using opposite CPR Gomu and 2S Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPR Gomu position performs unexpectedly, 2S Metal 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 2S Metal will offset losses from the drop in 2S Metal's long position.| CPR Gomu vs. Thoresen Thai Agencies | CPR Gomu vs. Sri Trang Agro Industry | CPR Gomu vs. TPI Polene Public | CPR Gomu vs. Ratchthani Leasing Public |
| 2S Metal vs. Tata Steel Public | 2S Metal vs. G J Steel | 2S Metal vs. POSCO Thainox Public | 2S Metal vs. TMT Steel 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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