Correlation Between CNOOC and Ribbon Communications
Can any of the company-specific risk be diversified away by investing in both CNOOC and Ribbon Communications 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 CNOOC and Ribbon Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CNOOC and Ribbon Communications, you can compare the effects of market volatilities on CNOOC and Ribbon Communications 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 CNOOC with a short position of Ribbon Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNOOC and Ribbon Communications.
Diversification Opportunities for CNOOC and Ribbon Communications
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CNOOC and Ribbon is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding CNOOC and Ribbon Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ribbon Communications and CNOOC 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 CNOOC are associated (or correlated) with Ribbon Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ribbon Communications has no effect on the direction of CNOOC i.e., CNOOC and Ribbon Communications go up and down completely randomly.
Pair Corralation between CNOOC and Ribbon Communications
If you would invest 362.00 in Ribbon Communications on October 7, 2024 and sell it today you would earn a total of 16.00 from holding Ribbon Communications or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
CNOOC vs. Ribbon Communications
Performance |
| Timeline |
| CNOOC |
| Ribbon Communications |
CNOOC and Ribbon Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNOOC and Ribbon Communications
The main advantage of trading using opposite CNOOC and Ribbon Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNOOC position performs unexpectedly, Ribbon Communications 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 Ribbon Communications will offset losses from the drop in Ribbon Communications' long position.| CNOOC vs. PACIFIC ONLINE | CNOOC vs. SWISS WATER DECAFFCOFFEE | CNOOC vs. Global Ship Lease | CNOOC vs. Salesforce |
| Ribbon Communications vs. T Mobile | Ribbon Communications vs. Nippon Telegraph and | Ribbon Communications vs. Superior Plus Corp | Ribbon Communications vs. NMI Holdings |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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