Correlation Between COLUMBIA SPORTSWEAR and Companhia Energtica
Can any of the company-specific risk be diversified away by investing in both COLUMBIA SPORTSWEAR and Companhia Energtica 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 COLUMBIA SPORTSWEAR and Companhia Energtica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COLUMBIA SPORTSWEAR and Companhia Energtica de, you can compare the effects of market volatilities on COLUMBIA SPORTSWEAR and Companhia Energtica 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 COLUMBIA SPORTSWEAR with a short position of Companhia Energtica. Check out your portfolio center. Please also check ongoing floating volatility patterns of COLUMBIA SPORTSWEAR and Companhia Energtica.
Diversification Opportunities for COLUMBIA SPORTSWEAR and Companhia Energtica
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between COLUMBIA and Companhia is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding COLUMBIA SPORTSWEAR and Companhia Energtica de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Companhia Energtica and COLUMBIA SPORTSWEAR 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 COLUMBIA SPORTSWEAR are associated (or correlated) with Companhia Energtica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Companhia Energtica has no effect on the direction of COLUMBIA SPORTSWEAR i.e., COLUMBIA SPORTSWEAR and Companhia Energtica go up and down completely randomly.
Pair Corralation between COLUMBIA SPORTSWEAR and Companhia Energtica
Assuming the 90 days trading horizon COLUMBIA SPORTSWEAR is expected to generate 0.31 times more return on investment than Companhia Energtica. However, COLUMBIA SPORTSWEAR is 3.24 times less risky than Companhia Energtica. It trades about 0.25 of its potential returns per unit of risk. Companhia Energtica de is currently generating about 0.01 per unit of risk. If you would invest 7,820 in COLUMBIA SPORTSWEAR on September 13, 2024 and sell it today you would earn a total of 730.00 from holding COLUMBIA SPORTSWEAR or generate 9.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COLUMBIA SPORTSWEAR vs. Companhia Energtica de
Performance |
| Timeline |
| COLUMBIA SPORTSWEAR |
| Companhia Energtica |
COLUMBIA SPORTSWEAR and Companhia Energtica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COLUMBIA SPORTSWEAR and Companhia Energtica
The main advantage of trading using opposite COLUMBIA SPORTSWEAR and Companhia Energtica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COLUMBIA SPORTSWEAR position performs unexpectedly, Companhia Energtica 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 Companhia Energtica will offset losses from the drop in Companhia Energtica's long position.| COLUMBIA SPORTSWEAR vs. Apple Inc | COLUMBIA SPORTSWEAR vs. Apple Inc | COLUMBIA SPORTSWEAR vs. Apple Inc | COLUMBIA SPORTSWEAR vs. Apple Inc |
| Companhia Energtica vs. SSE PLC ADR | Companhia Energtica vs. CIA ENGER ADR | Companhia Energtica vs. Companhia Energtica de | Companhia Energtica vs. EVN AG |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |