Correlation Between P10 and Chimera Investment
Can any of the company-specific risk be diversified away by investing in both P10 and Chimera Investment 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 P10 and Chimera Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between P10 Inc and Chimera Investment, you can compare the effects of market volatilities on P10 and Chimera Investment 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 P10 with a short position of Chimera Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of P10 and Chimera Investment.
Diversification Opportunities for P10 and Chimera Investment
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between P10 and Chimera is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding P10 Inc and Chimera Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chimera Investment and P10 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 P10 Inc are associated (or correlated) with Chimera Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chimera Investment has no effect on the direction of P10 i.e., P10 and Chimera Investment go up and down completely randomly.
Pair Corralation between P10 and Chimera Investment
Allowing for the 90-day total investment horizon P10 Inc is expected to generate 1.54 times more return on investment than Chimera Investment. However, P10 is 1.54 times more volatile than Chimera Investment. It trades about 0.2 of its potential returns per unit of risk. Chimera Investment is currently generating about -0.02 per unit of risk. If you would invest 1,082 in P10 Inc on November 2, 2024 and sell it today you would earn a total of 290.00 from holding P10 Inc or generate 26.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.33% |
| Values | Daily Returns |
P10 Inc vs. Chimera Investment
Performance |
| Timeline |
| P10 Inc |
| Chimera Investment |
P10 and Chimera Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with P10 and Chimera Investment
The main advantage of trading using opposite P10 and Chimera Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if P10 position performs unexpectedly, Chimera Investment 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 Chimera Investment will offset losses from the drop in Chimera Investment's long position.| P10 vs. Federated Premier Municipal | P10 vs. Blackrock Muniyield | P10 vs. Diamond Hill Investment | P10 vs. NXG NextGen Infrastructure |
| Chimera Investment vs. Two Harbors Investments | Chimera Investment vs. MFA Financial | Chimera Investment vs. Invesco Mortgage Capital | Chimera Investment vs. Orchid Island Capital |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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