Correlation Between CVS Health and RTL Group
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By analyzing existing cross correlation between CVS Health and RTL Group SA, you can compare the effects of market volatilities on CVS Health and RTL Group 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 CVS Health with a short position of RTL Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVS Health and RTL Group.
Diversification Opportunities for CVS Health and RTL Group
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CVS and RTL is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding CVS Health and RTL Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RTL Group SA and CVS Health 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 CVS Health are associated (or correlated) with RTL Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RTL Group SA has no effect on the direction of CVS Health i.e., CVS Health and RTL Group go up and down completely randomly.
Pair Corralation between CVS Health and RTL Group
Assuming the 90 days trading horizon CVS Health is expected to generate 2.0 times more return on investment than RTL Group. However, CVS Health is 2.0 times more volatile than RTL Group SA. It trades about 0.51 of its potential returns per unit of risk. RTL Group SA is currently generating about 0.25 per unit of risk. If you would invest 4,275 in CVS Health on October 20, 2024 and sell it today you would earn a total of 852.00 from holding CVS Health or generate 19.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CVS Health vs. RTL Group SA
Performance |
| Timeline |
| CVS Health |
| RTL Group SA |
CVS Health and RTL Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVS Health and RTL Group
The main advantage of trading using opposite CVS Health and RTL Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVS Health position performs unexpectedly, RTL Group 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 RTL Group will offset losses from the drop in RTL Group's long position.| CVS Health vs. VITEC SOFTWARE GROUP | CVS Health vs. MAGIC SOFTWARE ENTR | CVS Health vs. Infrastrutture Wireless Italiane | CVS Health vs. Kingdee International Software |
| RTL Group vs. KUAISHOU TECHNOLOGY CLB | RTL Group vs. FOX P B | RTL Group vs. Vivendi SE | RTL Group vs. News Corporation |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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