Correlation Between CRA International and LanzaTech Global
Can any of the company-specific risk be diversified away by investing in both CRA International and LanzaTech Global 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 CRA International and LanzaTech Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CRA International and LanzaTech Global, you can compare the effects of market volatilities on CRA International and LanzaTech Global 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 CRA International with a short position of LanzaTech Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of CRA International and LanzaTech Global.
Diversification Opportunities for CRA International and LanzaTech Global
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CRA and LanzaTech is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding CRA International and LanzaTech Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LanzaTech Global and CRA 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 CRA International are associated (or correlated) with LanzaTech Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LanzaTech Global has no effect on the direction of CRA International i.e., CRA International and LanzaTech Global go up and down completely randomly.
Pair Corralation between CRA International and LanzaTech Global
Given the investment horizon of 90 days CRA International is expected to generate 138.54 times less return on investment than LanzaTech Global. But when comparing it to its historical volatility, CRA International is 45.66 times less risky than LanzaTech Global. It trades about 0.03 of its potential returns per unit of risk. LanzaTech Global is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 19.00 in LanzaTech Global on September 3, 2024 and sell it today you would lose (7.55) from holding LanzaTech Global or give up 39.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 80.0% |
| Values | Daily Returns |
CRA International vs. LanzaTech Global
Performance |
| Timeline |
| CRA International |
| LanzaTech Global |
CRA International and LanzaTech Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CRA International and LanzaTech Global
The main advantage of trading using opposite CRA International and LanzaTech Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CRA International position performs unexpectedly, LanzaTech Global 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 LanzaTech Global will offset losses from the drop in LanzaTech Global's long position.| CRA International vs. Franklin Covey | CRA International vs. ICF International | CRA International vs. Huron Consulting Group | CRA International vs. FTI Consulting |
| LanzaTech Global vs. Avalon Holdings | LanzaTech Global vs. Clean Harbors | LanzaTech Global vs. Gfl Environmental Holdings | LanzaTech Global vs. Montrose Environmental Grp |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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