Correlation Between Snap and Cass Information
Can any of the company-specific risk be diversified away by investing in both Snap 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 Snap and Cass Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and Cass Information Systems, you can compare the effects of market volatilities on Snap 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 Snap with a short position of Cass Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Cass Information.
Diversification Opportunities for Snap and Cass Information
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Snap and Cass is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc 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 Snap 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 Snap Inc 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 Snap i.e., Snap and Cass Information go up and down completely randomly.
Pair Corralation between Snap and Cass Information
Given the investment horizon of 90 days Snap Inc is expected to generate 2.18 times more return on investment than Cass Information. However, Snap is 2.18 times more volatile than Cass Information Systems. It trades about 0.03 of its potential returns per unit of risk. Cass Information Systems is currently generating about 0.03 per unit of risk. If you would invest 1,004 in Snap Inc on August 31, 2024 and sell it today you would earn a total of 177.00 from holding Snap Inc or generate 17.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.42% |
| Values | Daily Returns |
Snap Inc vs. Cass Information Systems
Performance |
| Timeline |
| Snap Inc |
| Cass Information Systems |
Snap and Cass Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and Cass Information
The main advantage of trading using opposite Snap and Cass Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap 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.The idea behind Snap Inc and Cass Information Systems 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.| Cass Information vs. Singapore Telecommunications Limited | Cass Information vs. SBA Communications Corp | Cass Information vs. Tower One Wireless | Cass Information vs. Verizon Communications |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |