Correlation Between EQUITY GROUP and CO OPERATIVE
Can any of the company-specific risk be diversified away by investing in both EQUITY GROUP and CO OPERATIVE 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 EQUITY GROUP and CO OPERATIVE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EQUITY GROUP HOLDINGS and CO OPERATIVE BANK OF, you can compare the effects of market volatilities on EQUITY GROUP and CO OPERATIVE 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 EQUITY GROUP with a short position of CO OPERATIVE. Check out your portfolio center. Please also check ongoing floating volatility patterns of EQUITY GROUP and CO OPERATIVE.
Diversification Opportunities for EQUITY GROUP and CO OPERATIVE
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between EQUITY and CBKL is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding EQUITY GROUP HOLDINGS and CO OPERATIVE BANK OF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CO OPERATIVE BANK and EQUITY GROUP 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 EQUITY GROUP HOLDINGS are associated (or correlated) with CO OPERATIVE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CO OPERATIVE BANK has no effect on the direction of EQUITY GROUP i.e., EQUITY GROUP and CO OPERATIVE go up and down completely randomly.
Pair Corralation between EQUITY GROUP and CO OPERATIVE
Assuming the 90 days trading horizon EQUITY GROUP HOLDINGS is expected to under-perform the CO OPERATIVE. In addition to that, EQUITY GROUP is 1.83 times more volatile than CO OPERATIVE BANK OF. It trades about -0.16 of its total potential returns per unit of risk. CO OPERATIVE BANK OF is currently generating about -0.06 per unit of volatility. If you would invest 1,405 in CO OPERATIVE BANK OF on September 4, 2024 and sell it today you would lose (15.00) from holding CO OPERATIVE BANK OF or give up 1.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
EQUITY GROUP HOLDINGS vs. CO OPERATIVE BANK OF
Performance |
| Timeline |
| EQUITY GROUP HOLDINGS |
| CO OPERATIVE BANK |
EQUITY GROUP and CO OPERATIVE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EQUITY GROUP and CO OPERATIVE
The main advantage of trading using opposite EQUITY GROUP and CO OPERATIVE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EQUITY GROUP position performs unexpectedly, CO OPERATIVE 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 CO OPERATIVE will offset losses from the drop in CO OPERATIVE's long position.| EQUITY GROUP vs. HOME AFRIKA LTD | EQUITY GROUP vs. CIC INSURANCE GROUP | EQUITY GROUP vs. HOMEBOYZ ENTERTAINMENT PLC | EQUITY GROUP vs. CARBACID INVESTMENTS LTD |
| CO OPERATIVE vs. KENYA RE INSURANCE PORATION | CO OPERATIVE vs. CIC INSURANCE GROUP | CO OPERATIVE vs. DIAMOND TRUST BANK | CO OPERATIVE vs. CARBACID INVESTMENTS LTD |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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