Correlation Between Bank Central and Cetus Capital

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Bank Central and Cetus Capital 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 Bank Central and Cetus Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Central Asia and Cetus Capital Acquisition, you can compare the effects of market volatilities on Bank Central and Cetus Capital 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 Bank Central with a short position of Cetus Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Central and Cetus Capital.

Diversification Opportunities for Bank Central and Cetus Capital

0.61
  Correlation Coefficient

Poor diversification

The 3 months correlation between Bank and Cetus is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Bank Central Asia and Cetus Capital Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cetus Capital Acquisition and Bank Central 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 Bank Central Asia are associated (or correlated) with Cetus Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cetus Capital Acquisition has no effect on the direction of Bank Central i.e., Bank Central and Cetus Capital go up and down completely randomly.

Pair Corralation between Bank Central and Cetus Capital

Assuming the 90 days horizon Bank Central is expected to generate 93.22 times less return on investment than Cetus Capital. But when comparing it to its historical volatility, Bank Central Asia is 43.42 times less risky than Cetus Capital. It trades about 0.05 of its potential returns per unit of risk. Cetus Capital Acquisition is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  1,063  in Cetus Capital Acquisition on September 1, 2024 and sell it today you would earn a total of  78.00  from holding Cetus Capital Acquisition or generate 7.34% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy34.13%
ValuesDaily Returns

Bank Central Asia  vs.  Cetus Capital Acquisition

 Performance 
       Timeline  
Bank Central Asia 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Bank Central Asia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Bank Central is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Cetus Capital Acquisition 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Cetus Capital Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cetus Capital is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Bank Central and Cetus Capital Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bank Central and Cetus Capital

The main advantage of trading using opposite Bank Central and Cetus Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Central position performs unexpectedly, Cetus Capital 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 Cetus Capital will offset losses from the drop in Cetus Capital's long position.
The idea behind Bank Central Asia and Cetus Capital Acquisition pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.

Other Complementary Tools

Bonds Directory
Find actively traded corporate debentures issued by US companies
Latest Portfolios
Quick portfolio dashboard that showcases your latest portfolios
Portfolio Dashboard
Portfolio dashboard that provides centralized access to all your investments
Pattern Recognition
Use different Pattern Recognition models to time the market across multiple global exchanges
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets