Correlation Between Economic Investment and Calian Technologies
Can any of the company-specific risk be diversified away by investing in both Economic Investment and Calian Technologies 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 Economic Investment and Calian Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Economic Investment Trust and Calian Technologies, you can compare the effects of market volatilities on Economic Investment and Calian Technologies 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 Economic Investment with a short position of Calian Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Economic Investment and Calian Technologies.
Diversification Opportunities for Economic Investment and Calian Technologies
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Economic and Calian is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Economic Investment Trust and Calian Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calian Technologies and Economic Investment 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 Economic Investment Trust are associated (or correlated) with Calian Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calian Technologies has no effect on the direction of Economic Investment i.e., Economic Investment and Calian Technologies go up and down completely randomly.
Pair Corralation between Economic Investment and Calian Technologies
Assuming the 90 days trading horizon Economic Investment Trust is expected to generate 0.78 times more return on investment than Calian Technologies. However, Economic Investment Trust is 1.28 times less risky than Calian Technologies. It trades about 0.36 of its potential returns per unit of risk. Calian Technologies is currently generating about 0.02 per unit of risk. If you would invest 16,703 in Economic Investment Trust on November 5, 2024 and sell it today you would earn a total of 1,657 from holding Economic Investment Trust or generate 9.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Economic Investment Trust vs. Calian Technologies
Performance |
| Timeline |
| Economic Investment Trust |
| Calian Technologies |
Economic Investment and Calian Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Economic Investment and Calian Technologies
The main advantage of trading using opposite Economic Investment and Calian Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Economic Investment position performs unexpectedly, Calian Technologies 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 Calian Technologies will offset losses from the drop in Calian Technologies' long position.| Economic Investment vs. Uniteds Limited | Economic Investment vs. E L Financial Corp | Economic Investment vs. Canadian General Investments | Economic Investment vs. Clairvest Group |
| Calian Technologies vs. Enghouse Systems | Calian Technologies vs. Jamieson Wellness | Calian Technologies vs. TECSYS Inc | Calian Technologies vs. Descartes Systems Group |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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