Correlation Between Caseys General and UNITED UTILITIES
Can any of the company-specific risk be diversified away by investing in both Caseys General and UNITED UTILITIES 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 Caseys General and UNITED UTILITIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caseys General Stores and UNITED UTILITIES GR, you can compare the effects of market volatilities on Caseys General and UNITED UTILITIES 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 Caseys General with a short position of UNITED UTILITIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caseys General and UNITED UTILITIES.
Diversification Opportunities for Caseys General and UNITED UTILITIES
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Caseys and UNITED is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Caseys General Stores and UNITED UTILITIES GR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITED UTILITIES and Caseys General 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 Caseys General Stores are associated (or correlated) with UNITED UTILITIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITED UTILITIES has no effect on the direction of Caseys General i.e., Caseys General and UNITED UTILITIES go up and down completely randomly.
Pair Corralation between Caseys General and UNITED UTILITIES
Assuming the 90 days trading horizon Caseys General Stores is expected to generate 1.26 times more return on investment than UNITED UTILITIES. However, Caseys General is 1.26 times more volatile than UNITED UTILITIES GR. It trades about 0.12 of its potential returns per unit of risk. UNITED UTILITIES GR is currently generating about 0.09 per unit of risk. If you would invest 29,518 in Caseys General Stores on September 3, 2024 and sell it today you would earn a total of 10,082 from holding Caseys General Stores or generate 34.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caseys General Stores vs. UNITED UTILITIES GR
Performance |
| Timeline |
| Caseys General Stores |
| UNITED UTILITIES |
Caseys General and UNITED UTILITIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caseys General and UNITED UTILITIES
The main advantage of trading using opposite Caseys General and UNITED UTILITIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caseys General position performs unexpectedly, UNITED UTILITIES 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 UNITED UTILITIES will offset losses from the drop in UNITED UTILITIES's long position.| Caseys General vs. APPLIED MATERIALS | Caseys General vs. Rayonier Advanced Materials | Caseys General vs. GOODYEAR T RUBBER | Caseys General vs. TITANIUM TRANSPORTGROUP |
| UNITED UTILITIES vs. ANTA SPORTS PRODUCT | UNITED UTILITIES vs. Transport International Holdings | UNITED UTILITIES vs. Sqs Software Quality | UNITED UTILITIES vs. PSI Software AG |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |