Correlation Between MasTec and Compass Diversified
Can any of the company-specific risk be diversified away by investing in both MasTec and Compass Diversified 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 MasTec and Compass Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MasTec Inc and Compass Diversified Holdings, you can compare the effects of market volatilities on MasTec and Compass Diversified 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 MasTec with a short position of Compass Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of MasTec and Compass Diversified.
Diversification Opportunities for MasTec and Compass Diversified
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MasTec and Compass is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding MasTec Inc and Compass Diversified Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compass Diversified and MasTec 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 MasTec Inc are associated (or correlated) with Compass Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compass Diversified has no effect on the direction of MasTec i.e., MasTec and Compass Diversified go up and down completely randomly.
Pair Corralation between MasTec and Compass Diversified
Considering the 90-day investment horizon MasTec is expected to generate 1.52 times less return on investment than Compass Diversified. In addition to that, MasTec is 1.88 times more volatile than Compass Diversified Holdings. It trades about 0.1 of its total potential returns per unit of risk. Compass Diversified Holdings is currently generating about 0.28 per unit of volatility. If you would invest 2,298 in Compass Diversified Holdings on October 15, 2024 and sell it today you would earn a total of 133.00 from holding Compass Diversified Holdings or generate 5.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MasTec Inc vs. Compass Diversified Holdings
Performance |
| Timeline |
| MasTec Inc |
| Compass Diversified |
MasTec and Compass Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MasTec and Compass Diversified
The main advantage of trading using opposite MasTec and Compass Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MasTec position performs unexpectedly, Compass Diversified 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 Compass Diversified will offset losses from the drop in Compass Diversified's long position.| MasTec vs. EMCOR Group | MasTec vs. Comfort Systems USA | MasTec vs. Primoris Services | MasTec vs. Granite Construction Incorporated |
| Compass Diversified vs. ATRenew Inc DRC | Compass Diversified vs. Cedar Realty Trust | Compass Diversified vs. Transportadora de Gas | Compass Diversified vs. GE Vernova LLC |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |