Correlation Between CVR Partners and Inter Parfums
Can any of the company-specific risk be diversified away by investing in both CVR Partners and Inter Parfums 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 CVR Partners and Inter Parfums into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVR Partners LP and Inter Parfums, you can compare the effects of market volatilities on CVR Partners and Inter Parfums 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 CVR Partners with a short position of Inter Parfums. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Partners and Inter Parfums.
Diversification Opportunities for CVR Partners and Inter Parfums
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CVR and Inter is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding CVR Partners LP and Inter Parfums in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inter Parfums and CVR Partners 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 CVR Partners LP are associated (or correlated) with Inter Parfums. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inter Parfums has no effect on the direction of CVR Partners i.e., CVR Partners and Inter Parfums go up and down completely randomly.
Pair Corralation between CVR Partners and Inter Parfums
Considering the 90-day investment horizon CVR Partners is expected to generate 1.15 times less return on investment than Inter Parfums. In addition to that, CVR Partners is 1.01 times more volatile than Inter Parfums. It trades about 0.21 of its total potential returns per unit of risk. Inter Parfums is currently generating about 0.25 per unit of volatility. If you would invest 13,039 in Inter Parfums on November 5, 2024 and sell it today you would earn a total of 1,063 from holding Inter Parfums or generate 8.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CVR Partners LP vs. Inter Parfums
Performance |
| Timeline |
| CVR Partners LP |
| Inter Parfums |
CVR Partners and Inter Parfums Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVR Partners and Inter Parfums
The main advantage of trading using opposite CVR Partners and Inter Parfums positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVR Partners position performs unexpectedly, Inter Parfums 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 Inter Parfums will offset losses from the drop in Inter Parfums' long position.| CVR Partners vs. CF Industries Holdings | CVR Partners vs. The Mosaic | CVR Partners vs. American Vanguard | CVR Partners vs. ICL Israel Chemicals |
| Inter Parfums vs. J J Snack | Inter Parfums vs. John B Sanfilippo | Inter Parfums vs. Innospec | Inter Parfums vs. Independent Bank |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |