Correlation Between First State and CP ALL
Can any of the company-specific risk be diversified away by investing in both First State and CP ALL 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 First State and CP ALL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First State Financial and CP ALL Public, you can compare the effects of market volatilities on First State and CP ALL 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 State with a short position of CP ALL. Check out your portfolio center. Please also check ongoing floating volatility patterns of First State and CP ALL.
Diversification Opportunities for First State and CP ALL
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and CVPBF is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding First State Financial and CP ALL Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CP ALL Public and First State 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 State Financial are associated (or correlated) with CP ALL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CP ALL Public has no effect on the direction of First State i.e., First State and CP ALL go up and down completely randomly.
Pair Corralation between First State and CP ALL
Given the investment horizon of 90 days First State Financial is expected to generate 4.13 times more return on investment than CP ALL. However, First State is 4.13 times more volatile than CP ALL Public. It trades about 0.08 of its potential returns per unit of risk. CP ALL Public is currently generating about -0.05 per unit of risk. If you would invest 2.90 in First State Financial on October 13, 2025 and sell it today you would earn a total of 0.10 from holding First State Financial or generate 3.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First State Financial vs. CP ALL Public
Performance |
| Timeline |
| First State Financial |
| CP ALL Public |
First State and CP ALL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First State and CP ALL
The main advantage of trading using opposite First State and CP ALL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First State position performs unexpectedly, CP ALL 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 CP ALL will offset losses from the drop in CP ALL's long position.| First State vs. First Republic Bank | First State vs. BioCube | First State vs. Trend Exploration I | First State vs. Eastern Goldfields |
| CP ALL vs. Metro Inc | CP ALL vs. Loblaw Companies Limited | CP ALL vs. J Sainsbury PLC | CP ALL vs. Coca Cola HBC AG |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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