Correlation Between Webster Financial and CTS Eventim
Can any of the company-specific risk be diversified away by investing in both Webster Financial and CTS Eventim 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 Webster Financial and CTS Eventim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Webster Financial and CTS Eventim AG, you can compare the effects of market volatilities on Webster Financial and CTS Eventim 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 Webster Financial with a short position of CTS Eventim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Webster Financial and CTS Eventim.
Diversification Opportunities for Webster Financial and CTS Eventim
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Webster and CTS is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Webster Financial and CTS Eventim AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CTS Eventim AG and Webster Financial 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 Webster Financial are associated (or correlated) with CTS Eventim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CTS Eventim AG has no effect on the direction of Webster Financial i.e., Webster Financial and CTS Eventim go up and down completely randomly.
Pair Corralation between Webster Financial and CTS Eventim
Assuming the 90 days horizon Webster Financial is expected to generate 1.43 times more return on investment than CTS Eventim. However, Webster Financial is 1.43 times more volatile than CTS Eventim AG. It trades about 0.2 of its potential returns per unit of risk. CTS Eventim AG is currently generating about -0.03 per unit of risk. If you would invest 3,927 in Webster Financial on September 12, 2024 and sell it today you would earn a total of 1,723 from holding Webster Financial or generate 43.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Webster Financial vs. CTS Eventim AG
Performance |
| Timeline |
| Webster Financial |
| CTS Eventim AG |
Webster Financial and CTS Eventim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Webster Financial and CTS Eventim
The main advantage of trading using opposite Webster Financial and CTS Eventim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Webster Financial position performs unexpectedly, CTS Eventim 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 CTS Eventim will offset losses from the drop in CTS Eventim's long position.| Webster Financial vs. Fifth Third Bancorp | Webster Financial vs. Regions Financial | Webster Financial vs. Superior Plus Corp | Webster Financial vs. SIVERS SEMICONDUCTORS AB |
| CTS Eventim vs. Silicon Motion Technology | CTS Eventim vs. Shin Etsu Chemical Co | CTS Eventim vs. Solstad Offshore ASA | CTS Eventim vs. Eidesvik Offshore ASA |
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 CEOs Directory module to screen CEOs from public companies around the world.
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