Correlation Between Credit Suisse and Columbia Acorn
Can any of the company-specific risk be diversified away by investing in both Credit Suisse and Columbia Acorn 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 Credit Suisse and Columbia Acorn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credit Suisse Managed and Columbia Acorn International, you can compare the effects of market volatilities on Credit Suisse and Columbia Acorn 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 Credit Suisse with a short position of Columbia Acorn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Suisse and Columbia Acorn.
Diversification Opportunities for Credit Suisse and Columbia Acorn
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Credit and Columbia is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Credit Suisse Managed and Columbia Acorn International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Acorn Inter and Credit Suisse 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 Credit Suisse Managed are associated (or correlated) with Columbia Acorn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Acorn Inter has no effect on the direction of Credit Suisse i.e., Credit Suisse and Columbia Acorn go up and down completely randomly.
Pair Corralation between Credit Suisse and Columbia Acorn
Assuming the 90 days horizon Credit Suisse is expected to generate 3.71 times less return on investment than Columbia Acorn. But when comparing it to its historical volatility, Credit Suisse Managed is 1.46 times less risky than Columbia Acorn. It trades about 0.11 of its potential returns per unit of risk. Columbia Acorn International is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 2,149 in Columbia Acorn International on November 3, 2024 and sell it today you would earn a total of 125.00 from holding Columbia Acorn International or generate 5.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Credit Suisse Managed vs. Columbia Acorn International
Performance |
| Timeline |
| Credit Suisse Managed |
| Columbia Acorn Inter |
Credit Suisse and Columbia Acorn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Credit Suisse and Columbia Acorn
The main advantage of trading using opposite Credit Suisse and Columbia Acorn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Suisse position performs unexpectedly, Columbia Acorn 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 Columbia Acorn will offset losses from the drop in Columbia Acorn's long position.| Credit Suisse vs. Fkhemx | Credit Suisse vs. Wabmsx | Credit Suisse vs. Fbjygx | Credit Suisse vs. Small Pany Growth |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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