Correlation Between CPI Aerostructures and Safe Pro
Can any of the company-specific risk be diversified away by investing in both CPI Aerostructures and Safe Pro 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 Safe Pro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPI Aerostructures and Safe Pro Group, you can compare the effects of market volatilities on CPI Aerostructures and Safe Pro 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 Safe Pro. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPI Aerostructures and Safe Pro.
Diversification Opportunities for CPI Aerostructures and Safe Pro
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CPI and Safe is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding CPI Aerostructures and Safe Pro Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safe Pro 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 Safe Pro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Safe Pro Group has no effect on the direction of CPI Aerostructures i.e., CPI Aerostructures and Safe Pro go up and down completely randomly.
Pair Corralation between CPI Aerostructures and Safe Pro
Considering the 90-day investment horizon CPI Aerostructures is expected to generate 2.9 times less return on investment than Safe Pro. But when comparing it to its historical volatility, CPI Aerostructures is 3.92 times less risky than Safe Pro. It trades about 0.08 of its potential returns per unit of risk. Safe Pro Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 427.00 in Safe Pro Group on August 27, 2024 and sell it today you would earn a total of 30.00 from holding Safe Pro Group or generate 7.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 33.51% |
| Values | Daily Returns |
CPI Aerostructures vs. Safe Pro Group
Performance |
| Timeline |
| CPI Aerostructures |
| Safe Pro Group |
CPI Aerostructures and Safe Pro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPI Aerostructures and Safe Pro
The main advantage of trading using opposite CPI Aerostructures and Safe Pro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPI Aerostructures position performs unexpectedly, Safe Pro 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 Safe Pro will offset losses from the drop in Safe Pro's long position.| CPI Aerostructures vs. Redwire Corp | CPI Aerostructures vs. Sidus Space | CPI Aerostructures vs. Rocket Lab USA | CPI Aerostructures vs. Momentus |
| Safe Pro vs. Titan International | Safe Pro vs. Digi International | Safe Pro vs. Tianjin Capital Environmental | Safe Pro vs. Allegheny Technologies Incorporated |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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