Correlation Between CoreCivic and MSA Safety
Can any of the company-specific risk be diversified away by investing in both CoreCivic and MSA Safety 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 CoreCivic and MSA Safety into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CoreCivic and MSA Safety, you can compare the effects of market volatilities on CoreCivic and MSA Safety 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 CoreCivic with a short position of MSA Safety. Check out your portfolio center. Please also check ongoing floating volatility patterns of CoreCivic and MSA Safety.
Diversification Opportunities for CoreCivic and MSA Safety
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between CoreCivic and MSA is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding CoreCivic and MSA Safety in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MSA Safety and CoreCivic 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 CoreCivic are associated (or correlated) with MSA Safety. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MSA Safety has no effect on the direction of CoreCivic i.e., CoreCivic and MSA Safety go up and down completely randomly.
Pair Corralation between CoreCivic and MSA Safety
Considering the 90-day investment horizon CoreCivic is expected to generate 2.81 times more return on investment than MSA Safety. However, CoreCivic is 2.81 times more volatile than MSA Safety. It trades about 0.06 of its potential returns per unit of risk. MSA Safety is currently generating about 0.02 per unit of risk. If you would invest 1,434 in CoreCivic on September 14, 2024 and sell it today you would earn a total of 739.50 from holding CoreCivic or generate 51.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CoreCivic vs. MSA Safety
Performance |
| Timeline |
| CoreCivic |
| MSA Safety |
CoreCivic and MSA Safety Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CoreCivic and MSA Safety
The main advantage of trading using opposite CoreCivic and MSA Safety positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CoreCivic position performs unexpectedly, MSA Safety 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 MSA Safety will offset losses from the drop in MSA Safety's long position.| CoreCivic vs. ADT Inc | CoreCivic vs. NL Industries | CoreCivic vs. Mistras Group | CoreCivic vs. Evolv Technologies Holdings |
| MSA Safety vs. Allegion PLC | MSA Safety vs. Resideo Technologies | MSA Safety vs. NL Industries | MSA Safety vs. Brady |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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