Correlation Between CVR Partners and Weyco
Can any of the company-specific risk be diversified away by investing in both CVR Partners and Weyco 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 Weyco 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 Weyco Group, you can compare the effects of market volatilities on CVR Partners and Weyco 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 Weyco. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Partners and Weyco.
Diversification Opportunities for CVR Partners and Weyco
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CVR and Weyco is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding CVR Partners LP and Weyco Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weyco Group 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 Weyco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weyco Group has no effect on the direction of CVR Partners i.e., CVR Partners and Weyco go up and down completely randomly.
Pair Corralation between CVR Partners and Weyco
Considering the 90-day investment horizon CVR Partners is expected to generate 3.05 times less return on investment than Weyco. But when comparing it to its historical volatility, CVR Partners LP is 1.45 times less risky than Weyco. It trades about 0.03 of its potential returns per unit of risk. Weyco Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,065 in Weyco Group on September 1, 2024 and sell it today you would earn a total of 506.00 from holding Weyco Group or generate 16.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CVR Partners LP vs. Weyco Group
Performance |
| Timeline |
| CVR Partners LP |
| Weyco Group |
CVR Partners and Weyco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVR Partners and Weyco
The main advantage of trading using opposite CVR Partners and Weyco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVR Partners position performs unexpectedly, Weyco 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 Weyco will offset losses from the drop in Weyco's long position.| CVR Partners vs. CF Industries Holdings | CVR Partners vs. The Mosaic | CVR Partners vs. American Vanguard | CVR Partners vs. ICL Israel Chemicals |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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