Correlation Between Cymbria and Guardian Capital
Can any of the company-specific risk be diversified away by investing in both Cymbria and Guardian Capital 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 Cymbria and Guardian Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cymbria and Guardian Capital Group, you can compare the effects of market volatilities on Cymbria and Guardian Capital 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 Cymbria with a short position of Guardian Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cymbria and Guardian Capital.
Diversification Opportunities for Cymbria and Guardian Capital
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cymbria and Guardian is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Cymbria and Guardian Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian Capital and Cymbria 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 Cymbria are associated (or correlated) with Guardian Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian Capital has no effect on the direction of Cymbria i.e., Cymbria and Guardian Capital go up and down completely randomly.
Pair Corralation between Cymbria and Guardian Capital
Assuming the 90 days trading horizon Cymbria is expected to generate 0.61 times more return on investment than Guardian Capital. However, Cymbria is 1.64 times less risky than Guardian Capital. It trades about 0.08 of its potential returns per unit of risk. Guardian Capital Group is currently generating about 0.01 per unit of risk. If you would invest 5,925 in Cymbria on August 31, 2024 and sell it today you would earn a total of 1,565 from holding Cymbria or generate 26.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Cymbria vs. Guardian Capital Group
Performance |
| Timeline |
| Cymbria |
| Guardian Capital |
Cymbria and Guardian Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cymbria and Guardian Capital
The main advantage of trading using opposite Cymbria and Guardian Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cymbria position performs unexpectedly, Guardian Capital 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 Guardian Capital will offset losses from the drop in Guardian Capital's long position.| Cymbria vs. Clairvest Group | Cymbria vs. Uniteds Limited | Cymbria vs. E L Financial Corp | Cymbria vs. Senvest Capital |
| Guardian Capital vs. Guardian Capital Group | Guardian Capital vs. Clairvest Group | Guardian Capital vs. E L Financial Corp | Guardian Capital vs. Accord Financial Corp |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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