Correlation Between CXFI Caixa and Northrop Grumman
Can any of the company-specific risk be diversified away by investing in both CXFI Caixa and Northrop Grumman 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 CXFI Caixa and Northrop Grumman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CXFI Caixa and Northrop Grumman, you can compare the effects of market volatilities on CXFI Caixa and Northrop Grumman 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 CXFI Caixa with a short position of Northrop Grumman. Check out your portfolio center. Please also check ongoing floating volatility patterns of CXFI Caixa and Northrop Grumman.
Diversification Opportunities for CXFI Caixa and Northrop Grumman
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CXFI and Northrop is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding CXFI Caixa and Northrop Grumman in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northrop Grumman and CXFI Caixa 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 CXFI Caixa are associated (or correlated) with Northrop Grumman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northrop Grumman has no effect on the direction of CXFI Caixa i.e., CXFI Caixa and Northrop Grumman go up and down completely randomly.
Pair Corralation between CXFI Caixa and Northrop Grumman
Assuming the 90 days trading horizon CXFI Caixa is expected to generate 1.34 times more return on investment than Northrop Grumman. However, CXFI Caixa is 1.34 times more volatile than Northrop Grumman. It trades about 0.04 of its potential returns per unit of risk. Northrop Grumman is currently generating about -0.32 per unit of risk. If you would invest 6,201 in CXFI Caixa on November 18, 2024 and sell it today you would earn a total of 79.00 from holding CXFI Caixa or generate 1.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CXFI Caixa vs. Northrop Grumman
Performance |
| Timeline |
| CXFI Caixa |
| Northrop Grumman |
CXFI Caixa and Northrop Grumman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CXFI Caixa and Northrop Grumman
The main advantage of trading using opposite CXFI Caixa and Northrop Grumman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CXFI Caixa position performs unexpectedly, Northrop Grumman 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 Northrop Grumman will offset losses from the drop in Northrop Grumman's long position.| CXFI Caixa vs. Energisa SA | CXFI Caixa vs. BTG Pactual Logstica | CXFI Caixa vs. Plano Plano Desenvolvimento | CXFI Caixa vs. Ares Management |
| Northrop Grumman vs. Raytheon Technologies | Northrop Grumman vs. The Boeing | Northrop Grumman vs. Lockheed Martin | Northrop Grumman vs. General Dynamics |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |