Correlation Between CPI Aerostructures and Conrad Industries
Can any of the company-specific risk be diversified away by investing in both CPI Aerostructures and Conrad Industries 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 Conrad Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPI Aerostructures and Conrad Industries, you can compare the effects of market volatilities on CPI Aerostructures and Conrad Industries 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 Conrad Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPI Aerostructures and Conrad Industries.
Diversification Opportunities for CPI Aerostructures and Conrad Industries
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CPI and Conrad is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding CPI Aerostructures and Conrad Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conrad Industries 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 Conrad Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conrad Industries has no effect on the direction of CPI Aerostructures i.e., CPI Aerostructures and Conrad Industries go up and down completely randomly.
Pair Corralation between CPI Aerostructures and Conrad Industries
If you would invest 333.00 in CPI Aerostructures on September 1, 2024 and sell it today you would earn a total of 48.00 from holding CPI Aerostructures or generate 14.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
CPI Aerostructures vs. Conrad Industries
Performance |
| Timeline |
| CPI Aerostructures |
| Conrad Industries |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
CPI Aerostructures and Conrad Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPI Aerostructures and Conrad Industries
The main advantage of trading using opposite CPI Aerostructures and Conrad Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPI Aerostructures position performs unexpectedly, Conrad Industries 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 Conrad Industries will offset losses from the drop in Conrad Industries' long position.| CPI Aerostructures vs. Ducommun Incorporated | CPI Aerostructures vs. SIFCO Industries | CPI Aerostructures vs. Innovative Solutions and | CPI Aerostructures vs. Air Industries Group |
| Conrad Industries vs. Thales SA ADR | Conrad Industries vs. MTU Aero Engines | Conrad Industries vs. Safran SA | Conrad Industries vs. Leonardo SpA ADR |
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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