Correlation Between FIRST MUTUAL and CAFCA
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By analyzing existing cross correlation between FIRST MUTUAL PROPERTIES and CAFCA LIMITED, you can compare the effects of market volatilities on FIRST MUTUAL and CAFCA 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 FIRST MUTUAL with a short position of CAFCA. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIRST MUTUAL and CAFCA.
Diversification Opportunities for FIRST MUTUAL and CAFCA
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between FIRST and CAFCA is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding FIRST MUTUAL PROPERTIES and CAFCA LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAFCA LIMITED and FIRST MUTUAL 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 FIRST MUTUAL PROPERTIES are associated (or correlated) with CAFCA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAFCA LIMITED has no effect on the direction of FIRST MUTUAL i.e., FIRST MUTUAL and CAFCA go up and down completely randomly.
Pair Corralation between FIRST MUTUAL and CAFCA
Assuming the 90 days trading horizon FIRST MUTUAL is expected to generate 1.18 times less return on investment than CAFCA. In addition to that, FIRST MUTUAL is 1.03 times more volatile than CAFCA LIMITED. It trades about 0.1 of its total potential returns per unit of risk. CAFCA LIMITED is currently generating about 0.12 per unit of volatility. If you would invest 8,788,000 in CAFCA LIMITED on August 27, 2024 and sell it today you would lose (8,583,000) from holding CAFCA LIMITED or give up 97.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIRST MUTUAL PROPERTIES vs. CAFCA LIMITED
Performance |
| Timeline |
| FIRST MUTUAL PROPERTIES |
| CAFCA LIMITED |
FIRST MUTUAL and CAFCA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIRST MUTUAL and CAFCA
The main advantage of trading using opposite FIRST MUTUAL and CAFCA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIRST MUTUAL position performs unexpectedly, CAFCA 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 CAFCA will offset losses from the drop in CAFCA's long position.| FIRST MUTUAL vs. Cass Saddle Agriculture | FIRST MUTUAL vs. Morgan Co Made | FIRST MUTUAL vs. RIO ZIM LIMITED | FIRST MUTUAL vs. Morgan Co Multi |
| CAFCA vs. FIRST MUTUAL PROPERTIES | CAFCA vs. Cass Saddle Agriculture | CAFCA vs. Morgan Co Made | CAFCA vs. RIO ZIM LIMITED |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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