Correlation Between Phibro Animal and Cass Information
Can any of the company-specific risk be diversified away by investing in both Phibro Animal and Cass Information 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 Phibro Animal and Cass Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Phibro Animal Health and Cass Information Systems, you can compare the effects of market volatilities on Phibro Animal and Cass Information 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 Phibro Animal with a short position of Cass Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phibro Animal and Cass Information.
Diversification Opportunities for Phibro Animal and Cass Information
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Phibro and Cass is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Phibro Animal Health and Cass Information Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cass Information Systems and Phibro Animal 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 Phibro Animal Health are associated (or correlated) with Cass Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cass Information Systems has no effect on the direction of Phibro Animal i.e., Phibro Animal and Cass Information go up and down completely randomly.
Pair Corralation between Phibro Animal and Cass Information
Assuming the 90 days horizon Phibro Animal Health is expected to generate 1.54 times more return on investment than Cass Information. However, Phibro Animal is 1.54 times more volatile than Cass Information Systems. It trades about 0.04 of its potential returns per unit of risk. Cass Information Systems is currently generating about 0.0 per unit of risk. If you would invest 1,288 in Phibro Animal Health on October 11, 2024 and sell it today you would earn a total of 672.00 from holding Phibro Animal Health or generate 52.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Phibro Animal Health vs. Cass Information Systems
Performance |
| Timeline |
| Phibro Animal Health |
| Cass Information Systems |
Phibro Animal and Cass Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phibro Animal and Cass Information
The main advantage of trading using opposite Phibro Animal and Cass Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phibro Animal position performs unexpectedly, Cass Information 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 Cass Information will offset losses from the drop in Cass Information's long position.| Phibro Animal vs. BII Railway Transportation | Phibro Animal vs. TOREX SEMICONDUCTOR LTD | Phibro Animal vs. COLUMBIA SPORTSWEAR | Phibro Animal vs. USWE SPORTS AB |
| Cass Information vs. BE Semiconductor Industries | Cass Information vs. Amkor Technology | Cass Information vs. TOREX SEMICONDUCTOR LTD | Cass Information vs. MagnaChip Semiconductor Corp |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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