Correlation Between CMG Cleantech and Kaufman Et
Can any of the company-specific risk be diversified away by investing in both CMG Cleantech and Kaufman Et 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 CMG Cleantech and Kaufman Et into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CMG Cleantech SA and Kaufman Et Broad, you can compare the effects of market volatilities on CMG Cleantech and Kaufman Et 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 CMG Cleantech with a short position of Kaufman Et. Check out your portfolio center. Please also check ongoing floating volatility patterns of CMG Cleantech and Kaufman Et.
Diversification Opportunities for CMG Cleantech and Kaufman Et
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CMG and Kaufman is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding CMG Cleantech SA and Kaufman Et Broad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaufman Et Broad and CMG Cleantech 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 CMG Cleantech SA are associated (or correlated) with Kaufman Et. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaufman Et Broad has no effect on the direction of CMG Cleantech i.e., CMG Cleantech and Kaufman Et go up and down completely randomly.
Pair Corralation between CMG Cleantech and Kaufman Et
Assuming the 90 days trading horizon CMG Cleantech SA is expected to under-perform the Kaufman Et. In addition to that, CMG Cleantech is 3.11 times more volatile than Kaufman Et Broad. It trades about -0.01 of its total potential returns per unit of risk. Kaufman Et Broad is currently generating about 0.04 per unit of volatility. If you would invest 2,379 in Kaufman Et Broad on August 29, 2024 and sell it today you would earn a total of 781.00 from holding Kaufman Et Broad or generate 32.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.44% |
| Values | Daily Returns |
CMG Cleantech SA vs. Kaufman Et Broad
Performance |
| Timeline |
| CMG Cleantech SA |
| Kaufman Et Broad |
CMG Cleantech and Kaufman Et Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CMG Cleantech and Kaufman Et
The main advantage of trading using opposite CMG Cleantech and Kaufman Et positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CMG Cleantech position performs unexpectedly, Kaufman Et 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 Kaufman Et will offset losses from the drop in Kaufman Et's long position.| CMG Cleantech vs. EPC Groupe | CMG Cleantech vs. Groupe Sfpi | CMG Cleantech vs. NSE SA | CMG Cleantech vs. Manitou BF SA |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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