Correlation Between Premier Products and Coastal Capital
Can any of the company-specific risk be diversified away by investing in both Premier Products and Coastal 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 Premier Products and Coastal Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Premier Products Group and Coastal Capital Acq, you can compare the effects of market volatilities on Premier Products and Coastal 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 Premier Products with a short position of Coastal Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Premier Products and Coastal Capital.
Diversification Opportunities for Premier Products and Coastal Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Premier and Coastal is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Premier Products Group and Coastal Capital Acq in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coastal Capital Acq and Premier Products 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 Premier Products Group are associated (or correlated) with Coastal Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coastal Capital Acq has no effect on the direction of Premier Products i.e., Premier Products and Coastal Capital go up and down completely randomly.
Pair Corralation between Premier Products and Coastal Capital
Given the investment horizon of 90 days Premier Products is expected to generate 1.91 times less return on investment than Coastal Capital. But when comparing it to its historical volatility, Premier Products Group is 1.21 times less risky than Coastal Capital. It trades about 0.06 of its potential returns per unit of risk. Coastal Capital Acq is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 0.14 in Coastal Capital Acq on August 30, 2024 and sell it today you would lose (0.07) from holding Coastal Capital Acq or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Premier Products Group vs. Coastal Capital Acq
Performance |
| Timeline |
| Premier Products |
| Coastal Capital Acq |
Premier Products and Coastal Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Premier Products and Coastal Capital
The main advantage of trading using opposite Premier Products and Coastal Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Premier Products position performs unexpectedly, Coastal 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 Coastal Capital will offset losses from the drop in Coastal Capital's long position.| Premier Products vs. Green Planet Bio | Premier Products vs. Azure Holding Group | Premier Products vs. Four Leaf Acquisition | Premier Products vs. Opus Magnum Ameris |
| Coastal Capital vs. LiveChain | Coastal Capital vs. CLST Holdings | Coastal Capital vs. Premier Products Group | Coastal Capital vs. Jadeart Group |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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