Correlation Between Snap and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both Snap and Credit Suisse 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 Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and Credit Suisse Floating, you can compare the effects of market volatilities on Snap and Credit Suisse 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 Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Credit Suisse.
Diversification Opportunities for Snap and Credit Suisse
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Snap and Credit is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and Credit Suisse Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Floating 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 Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Floating has no effect on the direction of Snap i.e., Snap and Credit Suisse go up and down completely randomly.
Pair Corralation between Snap and Credit Suisse
Given the investment horizon of 90 days Snap Inc is expected to generate 19.79 times more return on investment than Credit Suisse. However, Snap is 19.79 times more volatile than Credit Suisse Floating. It trades about 0.11 of its potential returns per unit of risk. Credit Suisse Floating is currently generating about 0.19 per unit of risk. If you would invest 1,045 in Snap Inc on August 26, 2024 and sell it today you would earn a total of 97.00 from holding Snap Inc or generate 9.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Snap Inc vs. Credit Suisse Floating
Performance |
| Timeline |
| Snap Inc |
| Credit Suisse Floating |
Snap and Credit Suisse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and Credit Suisse
The main advantage of trading using opposite Snap and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.The idea behind Snap Inc and Credit Suisse Floating 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.| Credit Suisse vs. Credit Suisse Floating | Credit Suisse vs. Credit Suisse Modity | Credit Suisse vs. Credit Suisse Modity | Credit Suisse vs. Credit Suisse Managed |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |