Correlation Between Maxim Power and Caribbean Utilities
Can any of the company-specific risk be diversified away by investing in both Maxim Power and Caribbean Utilities 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 Maxim Power and Caribbean Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maxim Power Corp and Caribbean Utilities, you can compare the effects of market volatilities on Maxim Power and Caribbean Utilities 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 Maxim Power with a short position of Caribbean Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maxim Power and Caribbean Utilities.
Diversification Opportunities for Maxim Power and Caribbean Utilities
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Maxim and Caribbean is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Maxim Power Corp and Caribbean Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caribbean Utilities and Maxim Power 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 Maxim Power Corp are associated (or correlated) with Caribbean Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caribbean Utilities has no effect on the direction of Maxim Power i.e., Maxim Power and Caribbean Utilities go up and down completely randomly.
Pair Corralation between Maxim Power and Caribbean Utilities
Assuming the 90 days trading horizon Maxim Power Corp is expected to generate 2.79 times more return on investment than Caribbean Utilities. However, Maxim Power is 2.79 times more volatile than Caribbean Utilities. It trades about 0.31 of its potential returns per unit of risk. Caribbean Utilities is currently generating about -0.03 per unit of risk. If you would invest 512.00 in Maxim Power Corp on October 22, 2024 and sell it today you would earn a total of 98.00 from holding Maxim Power Corp or generate 19.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Maxim Power Corp vs. Caribbean Utilities
Performance |
| Timeline |
| Maxim Power Corp |
| Caribbean Utilities |
Maxim Power and Caribbean Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maxim Power and Caribbean Utilities
The main advantage of trading using opposite Maxim Power and Caribbean Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maxim Power position performs unexpectedly, Caribbean Utilities 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 Caribbean Utilities will offset losses from the drop in Caribbean Utilities' long position.| Maxim Power vs. Caldwell Partners International | Maxim Power vs. Mccoy Global | Maxim Power vs. Pulse Seismic | Maxim Power vs. Currency Exchange International |
| Caribbean Utilities vs. Maxim Power Corp | Caribbean Utilities vs. ATCO | Caribbean Utilities vs. Capstone Infrastructure Corp | Caribbean Utilities vs. Richards Packaging Income |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |