Correlation Between Teijin and Cibl
Can any of the company-specific risk be diversified away by investing in both Teijin and Cibl 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 Teijin and Cibl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teijin and Cibl Inc, you can compare the effects of market volatilities on Teijin and Cibl 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 Teijin with a short position of Cibl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teijin and Cibl.
Diversification Opportunities for Teijin and Cibl
Excellent diversification
The 3 months correlation between Teijin and Cibl is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Teijin and Cibl Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cibl Inc and Teijin 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 Teijin are associated (or correlated) with Cibl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cibl Inc has no effect on the direction of Teijin i.e., Teijin and Cibl go up and down completely randomly.
Pair Corralation between Teijin and Cibl
Assuming the 90 days horizon Teijin is expected to under-perform the Cibl. But the pink sheet apears to be less risky and, when comparing its historical volatility, Teijin is 1.99 times less risky than Cibl. The pink sheet trades about -0.19 of its potential returns per unit of risk. The Cibl Inc is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 182,400 in Cibl Inc on August 27, 2024 and sell it today you would earn a total of 17,600 from holding Cibl Inc or generate 9.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Teijin vs. Cibl Inc
Performance |
| Timeline |
| Teijin |
| Cibl Inc |
Teijin and Cibl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teijin and Cibl
The main advantage of trading using opposite Teijin and Cibl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teijin position performs unexpectedly, Cibl 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 Cibl will offset losses from the drop in Cibl's long position.| Teijin vs. Toray Industries ADR | Teijin vs. Nitto Denko Corp | Teijin vs. NSK Ltd ADR | Teijin vs. Secom Co Ltd |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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