Correlation Between CREDIT and Western Acquisition
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By analyzing existing cross correlation between CREDIT SUISSE AG and Western Acquisition Ventures, you can compare the effects of market volatilities on CREDIT and Western Acquisition 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 CREDIT with a short position of Western Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of CREDIT and Western Acquisition.
Diversification Opportunities for CREDIT and Western Acquisition
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CREDIT and Western is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding CREDIT SUISSE AG and Western Acquisition Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Acquisition and CREDIT 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 CREDIT SUISSE AG are associated (or correlated) with Western Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Acquisition has no effect on the direction of CREDIT i.e., CREDIT and Western Acquisition go up and down completely randomly.
Pair Corralation between CREDIT and Western Acquisition
Assuming the 90 days trading horizon CREDIT SUISSE AG is expected to generate 0.04 times more return on investment than Western Acquisition. However, CREDIT SUISSE AG is 28.05 times less risky than Western Acquisition. It trades about 0.18 of its potential returns per unit of risk. Western Acquisition Ventures is currently generating about -0.13 per unit of risk. If you would invest 9,923 in CREDIT SUISSE AG on September 4, 2024 and sell it today you would earn a total of 16.00 from holding CREDIT SUISSE AG or generate 0.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 80.0% |
| Values | Daily Returns |
CREDIT SUISSE AG vs. Western Acquisition Ventures
Performance |
| Timeline |
| CREDIT SUISSE AG |
| Western Acquisition |
CREDIT and Western Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CREDIT and Western Acquisition
The main advantage of trading using opposite CREDIT and Western Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CREDIT position performs unexpectedly, Western Acquisition 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 Western Acquisition will offset losses from the drop in Western Acquisition's long position.| CREDIT vs. Highway Holdings Limited | CREDIT vs. Boot Barn Holdings | CREDIT vs. Ross Stores | CREDIT vs. Western Acquisition Ventures |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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