Correlation Between Pace High and Crossmark Steward
Can any of the company-specific risk be diversified away by investing in both Pace High and Crossmark Steward 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 Pace High and Crossmark Steward into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pace High Yield and Crossmark Steward Equity, you can compare the effects of market volatilities on Pace High and Crossmark Steward 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 Pace High with a short position of Crossmark Steward. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pace High and Crossmark Steward.
Diversification Opportunities for Pace High and Crossmark Steward
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pace and Crossmark is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Pace High Yield and Crossmark Steward Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crossmark Steward Equity and Pace High 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 Pace High Yield are associated (or correlated) with Crossmark Steward. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crossmark Steward Equity has no effect on the direction of Pace High i.e., Pace High and Crossmark Steward go up and down completely randomly.
Pair Corralation between Pace High and Crossmark Steward
Assuming the 90 days horizon Pace High Yield is expected to generate 0.22 times more return on investment than Crossmark Steward. However, Pace High Yield is 4.61 times less risky than Crossmark Steward. It trades about 0.12 of its potential returns per unit of risk. Crossmark Steward Equity is currently generating about -0.21 per unit of risk. If you would invest 893.00 in Pace High Yield on August 30, 2024 and sell it today you would earn a total of 5.00 from holding Pace High Yield or generate 0.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pace High Yield vs. Crossmark Steward Equity
Performance |
| Timeline |
| Pace High Yield |
| Crossmark Steward Equity |
Pace High and Crossmark Steward Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pace High and Crossmark Steward
The main advantage of trading using opposite Pace High and Crossmark Steward positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pace High position performs unexpectedly, Crossmark Steward 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 Crossmark Steward will offset losses from the drop in Crossmark Steward's long position.| Pace High vs. Prudential High Yield | Pace High vs. HUMANA INC | Pace High vs. Aquagold International | Pace High vs. Barloworld Ltd ADR |
| Crossmark Steward vs. Live Oak Health | Crossmark Steward vs. Prudential Health Sciences | Crossmark Steward vs. Fidelity Advisor Health | Crossmark Steward vs. Health Care Fund |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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