Correlation Between CSE Global and International Business
Can any of the company-specific risk be diversified away by investing in both CSE Global and International Business 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 CSE Global and International Business into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CSE Global Limited and International Business Machines, you can compare the effects of market volatilities on CSE Global and International Business 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 CSE Global with a short position of International Business. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSE Global and International Business.
Diversification Opportunities for CSE Global and International Business
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CSE and International is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding CSE Global Limited and International Business Machine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Business and CSE Global 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 CSE Global Limited are associated (or correlated) with International Business. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Business has no effect on the direction of CSE Global i.e., CSE Global and International Business go up and down completely randomly.
Pair Corralation between CSE Global and International Business
Assuming the 90 days horizon CSE Global Limited is expected to generate 1.48 times more return on investment than International Business. However, CSE Global is 1.48 times more volatile than International Business Machines. It trades about 0.22 of its potential returns per unit of risk. International Business Machines is currently generating about 0.18 per unit of risk. If you would invest 30.00 in CSE Global Limited on August 27, 2024 and sell it today you would earn a total of 3.00 from holding CSE Global Limited or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSE Global Limited vs. International Business Machine
Performance |
| Timeline |
| CSE Global Limited |
| International Business |
CSE Global and International Business Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSE Global and International Business
The main advantage of trading using opposite CSE Global and International Business positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSE Global position performs unexpectedly, International Business 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 International Business will offset losses from the drop in International Business' long position.| CSE Global vs. Two Hands Corp | CSE Global vs. Visium Technologies | CSE Global vs. Tautachrome | CSE Global vs. V Group |
| International Business vs. Data Storage Corp | International Business vs. Usio Inc | International Business vs. ARB IOT Group | International Business vs. FiscalNote Holdings |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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