Correlation Between Century Financial and STAR Financial
Can any of the company-specific risk be diversified away by investing in both Century Financial and STAR Financial 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 Century Financial and STAR Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Century Financial Corp and STAR Financial Group, you can compare the effects of market volatilities on Century Financial and STAR Financial 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 Century Financial with a short position of STAR Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Financial and STAR Financial.
Diversification Opportunities for Century Financial and STAR Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Century and STAR is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Century Financial Corp and STAR Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STAR Financial Group and Century Financial 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 Century Financial Corp are associated (or correlated) with STAR Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STAR Financial Group has no effect on the direction of Century Financial i.e., Century Financial and STAR Financial go up and down completely randomly.
Pair Corralation between Century Financial and STAR Financial
If you would invest 3,300 in Century Financial Corp on August 29, 2024 and sell it today you would earn a total of 450.00 from holding Century Financial Corp or generate 13.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Century Financial Corp vs. STAR Financial Group
Performance |
| Timeline |
| Century Financial Corp |
| STAR Financial Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Century Financial and STAR Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Century Financial and STAR Financial
The main advantage of trading using opposite Century Financial and STAR Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Century Financial position performs unexpectedly, STAR Financial 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 STAR Financial will offset losses from the drop in STAR Financial's long position.| Century Financial vs. Invesco High Income | Century Financial vs. Blackrock Muniholdings Ny | Century Financial vs. Nuveen California Select | Century Financial vs. MFS Investment Grade |
| STAR Financial vs. Century Financial Corp | STAR Financial vs. Eastern Michigan Financial | STAR Financial vs. Grand River Commerce | STAR Financial vs. Bank of Botetourt |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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