Correlation Between DATA MODUL and CME
Can any of the company-specific risk be diversified away by investing in both DATA MODUL and CME 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 DATA MODUL and CME into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DATA MODUL and CME Group, you can compare the effects of market volatilities on DATA MODUL and CME 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 DATA MODUL with a short position of CME. Check out your portfolio center. Please also check ongoing floating volatility patterns of DATA MODUL and CME.
Diversification Opportunities for DATA MODUL and CME
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between DATA and CME is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding DATA MODUL and CME Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CME Group and DATA MODUL 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 DATA MODUL are associated (or correlated) with CME. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CME Group has no effect on the direction of DATA MODUL i.e., DATA MODUL and CME go up and down completely randomly.
Pair Corralation between DATA MODUL and CME
Assuming the 90 days trading horizon DATA MODUL is expected to under-perform the CME. In addition to that, DATA MODUL is 1.82 times more volatile than CME Group. It trades about -0.08 of its total potential returns per unit of risk. CME Group is currently generating about 0.06 per unit of volatility. If you would invest 18,316 in CME Group on October 11, 2024 and sell it today you would earn a total of 3,854 from holding CME Group or generate 21.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DATA MODUL vs. CME Group
Performance |
| Timeline |
| DATA MODUL |
| CME Group |
DATA MODUL and CME Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DATA MODUL and CME
The main advantage of trading using opposite DATA MODUL and CME positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DATA MODUL position performs unexpectedly, CME 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 CME will offset losses from the drop in CME's long position.| DATA MODUL vs. InterContinental Hotels Group | DATA MODUL vs. PLAYMATES TOYS | DATA MODUL vs. USWE SPORTS AB | DATA MODUL vs. Playmates Toys Limited |
| CME vs. SPORTING | CME vs. PARKEN Sport Entertainment | CME vs. Transport International Holdings | CME vs. MAVEN WIRELESS SWEDEN |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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