Correlation Between Cass Saddle and STAR AFRICA
Can any of the company-specific risk be diversified away by investing in both Cass Saddle and STAR AFRICA 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 Cass Saddle and STAR AFRICA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cass Saddle Agriculture and STAR AFRICA PORATION, you can compare the effects of market volatilities on Cass Saddle and STAR AFRICA 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 Cass Saddle with a short position of STAR AFRICA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cass Saddle and STAR AFRICA.
Diversification Opportunities for Cass Saddle and STAR AFRICA
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cass and STAR is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Cass Saddle Agriculture and STAR AFRICA PORATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STAR AFRICA PORATION and Cass Saddle 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 Cass Saddle Agriculture are associated (or correlated) with STAR AFRICA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STAR AFRICA PORATION has no effect on the direction of Cass Saddle i.e., Cass Saddle and STAR AFRICA go up and down completely randomly.
Pair Corralation between Cass Saddle and STAR AFRICA
Assuming the 90 days trading horizon Cass Saddle Agriculture is expected to generate 0.52 times more return on investment than STAR AFRICA. However, Cass Saddle Agriculture is 1.92 times less risky than STAR AFRICA. It trades about 0.31 of its potential returns per unit of risk. STAR AFRICA PORATION is currently generating about 0.08 per unit of risk. If you would invest 250.00 in Cass Saddle Agriculture on November 6, 2024 and sell it today you would earn a total of 250.00 from holding Cass Saddle Agriculture or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cass Saddle Agriculture vs. STAR AFRICA PORATION
Performance |
| Timeline |
| Cass Saddle Agriculture |
| STAR AFRICA PORATION |
Cass Saddle and STAR AFRICA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cass Saddle and STAR AFRICA
The main advantage of trading using opposite Cass Saddle and STAR AFRICA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cass Saddle position performs unexpectedly, STAR AFRICA 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 STAR AFRICA will offset losses from the drop in STAR AFRICA's long position.| Cass Saddle vs. STAR AFRICA PORATION | Cass Saddle vs. CAFCA LIMITED | Cass Saddle vs. FIRST MUTUAL PROPERTIES | Cass Saddle vs. AFRICAN DISTILLERS LIMITED |
| STAR AFRICA vs. CAFCA LIMITED | STAR AFRICA vs. FIRST MUTUAL PROPERTIES | STAR AFRICA vs. AFRICAN DISTILLERS LIMITED | STAR AFRICA vs. TANGANDA TEA PANY |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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