Correlation Between CPI Aerostructures and CAM
Can any of the company-specific risk be diversified away by investing in both CPI Aerostructures and CAM 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 CPI Aerostructures and CAM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPI Aerostructures and CAM Group, you can compare the effects of market volatilities on CPI Aerostructures and CAM 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 CPI Aerostructures with a short position of CAM. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPI Aerostructures and CAM.
Diversification Opportunities for CPI Aerostructures and CAM
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CPI and CAM is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding CPI Aerostructures and CAM Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAM Group and CPI Aerostructures 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 CPI Aerostructures are associated (or correlated) with CAM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAM Group has no effect on the direction of CPI Aerostructures i.e., CPI Aerostructures and CAM go up and down completely randomly.
Pair Corralation between CPI Aerostructures and CAM
Considering the 90-day investment horizon CPI Aerostructures is expected to generate 7.12 times less return on investment than CAM. But when comparing it to its historical volatility, CPI Aerostructures is 5.27 times less risky than CAM. It trades about 0.16 of its potential returns per unit of risk. CAM Group is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 3.25 in CAM Group on September 1, 2024 and sell it today you would earn a total of 3.81 from holding CAM Group or generate 117.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
CPI Aerostructures vs. CAM Group
Performance |
| Timeline |
| CPI Aerostructures |
| CAM Group |
CPI Aerostructures and CAM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPI Aerostructures and CAM
The main advantage of trading using opposite CPI Aerostructures and CAM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPI Aerostructures position performs unexpectedly, CAM 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 CAM will offset losses from the drop in CAM's long position.| CPI Aerostructures vs. Ducommun Incorporated | CPI Aerostructures vs. SIFCO Industries | CPI Aerostructures vs. Innovative Solutions and | CPI Aerostructures vs. Air Industries Group |
| CAM vs. HUMANA INC | CAM vs. Aquagold International | CAM vs. Barloworld Ltd ADR | CAM vs. Thrivent High Yield |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |