Correlation Between CVS HEALTH and Contagious Gaming
Can any of the company-specific risk be diversified away by investing in both CVS HEALTH and Contagious Gaming 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 CVS HEALTH and Contagious Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVS HEALTH CDR and Contagious Gaming, you can compare the effects of market volatilities on CVS HEALTH and Contagious Gaming 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 Contagious Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVS HEALTH and Contagious Gaming.
Diversification Opportunities for CVS HEALTH and Contagious Gaming
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CVS and Contagious is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CVS HEALTH CDR and Contagious Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contagious Gaming 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 CDR are associated (or correlated) with Contagious Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contagious Gaming has no effect on the direction of CVS HEALTH i.e., CVS HEALTH and Contagious Gaming go up and down completely randomly.
Pair Corralation between CVS HEALTH and Contagious Gaming
Assuming the 90 days trading horizon CVS HEALTH CDR is expected to under-perform the Contagious Gaming. But the stock apears to be less risky and, when comparing its historical volatility, CVS HEALTH CDR is 3.98 times less risky than Contagious Gaming. The stock trades about -0.04 of its potential returns per unit of risk. The Contagious Gaming is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1.00 in Contagious Gaming on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Contagious Gaming or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
CVS HEALTH CDR vs. Contagious Gaming
Performance |
| Timeline |
| CVS HEALTH CDR |
| Contagious Gaming |
CVS HEALTH and Contagious Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVS HEALTH and Contagious Gaming
The main advantage of trading using opposite CVS HEALTH and Contagious Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVS HEALTH position performs unexpectedly, Contagious Gaming 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 Contagious Gaming will offset losses from the drop in Contagious Gaming's long position.| CVS HEALTH vs. Westaim Corp | CVS HEALTH vs. Pulse Seismic | CVS HEALTH vs. Quarterhill | CVS HEALTH vs. TECSYS Inc |
| Contagious Gaming vs. Telus Corp | Contagious Gaming vs. Toronto Dominion Bank | Contagious Gaming vs. TC Energy Corp | Contagious Gaming vs. Manulife Financial 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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