Correlation Between Calmare Therapeutics and Modine Manufacturing
Can any of the company-specific risk be diversified away by investing in both Calmare Therapeutics and Modine Manufacturing 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 Calmare Therapeutics and Modine Manufacturing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calmare Therapeutics and Modine Manufacturing, you can compare the effects of market volatilities on Calmare Therapeutics and Modine Manufacturing 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 Calmare Therapeutics with a short position of Modine Manufacturing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calmare Therapeutics and Modine Manufacturing.
Diversification Opportunities for Calmare Therapeutics and Modine Manufacturing
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Calmare and Modine is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Calmare Therapeutics and Modine Manufacturing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Modine Manufacturing and Calmare Therapeutics 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 Calmare Therapeutics are associated (or correlated) with Modine Manufacturing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Modine Manufacturing has no effect on the direction of Calmare Therapeutics i.e., Calmare Therapeutics and Modine Manufacturing go up and down completely randomly.
Pair Corralation between Calmare Therapeutics and Modine Manufacturing
If you would invest 4,004 in Modine Manufacturing on September 19, 2024 and sell it today you would earn a total of 7,762 from holding Modine Manufacturing or generate 193.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.34% |
| Values | Daily Returns |
Calmare Therapeutics vs. Modine Manufacturing
Performance |
| Timeline |
| Calmare Therapeutics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Modine Manufacturing |
Calmare Therapeutics and Modine Manufacturing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calmare Therapeutics and Modine Manufacturing
The main advantage of trading using opposite Calmare Therapeutics and Modine Manufacturing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calmare Therapeutics position performs unexpectedly, Modine Manufacturing 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 Modine Manufacturing will offset losses from the drop in Modine Manufacturing's long position.| Calmare Therapeutics vs. BioNTech SE | Calmare Therapeutics vs. Teleflex Incorporated | Calmare Therapeutics vs. Modine Manufacturing | Calmare Therapeutics vs. U Power Limited |
| Modine Manufacturing vs. Cooper Stnd | Modine Manufacturing vs. Motorcar Parts of | Modine Manufacturing vs. American Axle Manufacturing | Modine Manufacturing vs. Stoneridge |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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