Correlation Between Cisco Systems and UNITED
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By analyzing existing cross correlation between Cisco Systems and UNITED STS STL, you can compare the effects of market volatilities on Cisco Systems and UNITED 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 Cisco Systems with a short position of UNITED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisco Systems and UNITED.
Diversification Opportunities for Cisco Systems and UNITED
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cisco and UNITED is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems and UNITED STS STL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITED STS STL and Cisco Systems 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 Cisco Systems are associated (or correlated) with UNITED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITED STS STL has no effect on the direction of Cisco Systems i.e., Cisco Systems and UNITED go up and down completely randomly.
Pair Corralation between Cisco Systems and UNITED
Given the investment horizon of 90 days Cisco Systems is expected to generate 0.91 times more return on investment than UNITED. However, Cisco Systems is 1.1 times less risky than UNITED. It trades about 0.27 of its potential returns per unit of risk. UNITED STS STL is currently generating about 0.03 per unit of risk. If you would invest 4,968 in Cisco Systems on September 2, 2024 and sell it today you would earn a total of 953.00 from holding Cisco Systems or generate 19.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Cisco Systems vs. UNITED STS STL
Performance |
| Timeline |
| Cisco Systems |
| UNITED STS STL |
Cisco Systems and UNITED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cisco Systems and UNITED
The main advantage of trading using opposite Cisco Systems and UNITED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cisco Systems position performs unexpectedly, UNITED 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 will offset losses from the drop in UNITED's long position.| Cisco Systems vs. Juniper Networks | Cisco Systems vs. Nokia Corp ADR | Cisco Systems vs. Motorola Solutions | Cisco Systems vs. Ciena Corp |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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