Correlation Between Cooper Stnd and Commercial Vehicle
Can any of the company-specific risk be diversified away by investing in both Cooper Stnd and Commercial Vehicle 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 Cooper Stnd and Commercial Vehicle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cooper Stnd and Commercial Vehicle Group, you can compare the effects of market volatilities on Cooper Stnd and Commercial Vehicle 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 Cooper Stnd with a short position of Commercial Vehicle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cooper Stnd and Commercial Vehicle.
Diversification Opportunities for Cooper Stnd and Commercial Vehicle
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Cooper and Commercial is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Cooper Stnd and Commercial Vehicle Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial Vehicle and Cooper Stnd 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 Cooper Stnd are associated (or correlated) with Commercial Vehicle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial Vehicle has no effect on the direction of Cooper Stnd i.e., Cooper Stnd and Commercial Vehicle go up and down completely randomly.
Pair Corralation between Cooper Stnd and Commercial Vehicle
Considering the 90-day investment horizon Cooper Stnd is expected to under-perform the Commercial Vehicle. But the stock apears to be less risky and, when comparing its historical volatility, Cooper Stnd is 1.35 times less risky than Commercial Vehicle. The stock trades about -0.2 of its potential returns per unit of risk. The Commercial Vehicle Group is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 223.00 in Commercial Vehicle Group on November 18, 2024 and sell it today you would lose (17.00) from holding Commercial Vehicle Group or give up 7.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cooper Stnd vs. Commercial Vehicle Group
Performance |
| Timeline |
| Cooper Stnd |
| Commercial Vehicle |
Cooper Stnd and Commercial Vehicle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cooper Stnd and Commercial Vehicle
The main advantage of trading using opposite Cooper Stnd and Commercial Vehicle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cooper Stnd position performs unexpectedly, Commercial Vehicle 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 Commercial Vehicle will offset losses from the drop in Commercial Vehicle's long position.| Cooper Stnd vs. Dorman Products | Cooper Stnd vs. Monro Muffler Brake | Cooper Stnd vs. Standard Motor Products | Cooper Stnd vs. Stoneridge |
| Commercial Vehicle vs. Motorcar Parts of | Commercial Vehicle vs. Monro Muffler Brake | Commercial Vehicle vs. Stoneridge | Commercial Vehicle vs. Superior Industries International |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |