Correlation Between CM AM and Esfera Robotics

Can any of the company-specific risk be diversified away by investing in both CM AM and Esfera Robotics 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 CM AM and Esfera Robotics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CM AM Monplus NE and Esfera Robotics R, you can compare the effects of market volatilities on CM AM and Esfera Robotics 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 CM AM with a short position of Esfera Robotics. Check out your portfolio center. Please also check ongoing floating volatility patterns of CM AM and Esfera Robotics.

Diversification Opportunities for CM AM and Esfera Robotics

0.95

Correlation Coefficient

CM AM  Esfera Robotics

Almost no diversification

The 3 months correlation between 0P0001F96C and Esfera is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding CM AM Monplus NE and Esfera Robotics R in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esfera Robotics R and CM AM 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 CM AM Monplus NE are associated (or correlated) with Esfera Robotics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esfera Robotics R has no effect on the direction of CM AM i.e., CM AM and Esfera Robotics go up and down completely randomly.

Pair Corralation between CM AM and Esfera Robotics

Assuming the 90 days trading horizon CM AM is expected to generate 27.78 times less return on investment than Esfera Robotics. But when comparing it to its historical volatility, CM AM Monplus NE is 123.55 times less risky than Esfera Robotics. It trades about 1.47 of its potential returns per unit of risk. Esfera Robotics R is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest  28,305  in Esfera Robotics R on September 6, 2024 and sell it today you would earn a total of  7,153  from holding Esfera Robotics R or generate 25.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

CM AM Monplus NE  vs.  Esfera Robotics R

CM AM Monplus

Risk-Adjusted Performance

96 of 100

Market Crasher

Compared to the overall equity markets, risk-adjusted returns on investments in CM AM Monplus NE are ranked lower than 96 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable basic indicators, CM AM is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Esfera Robotics R

Risk-Adjusted Performance

25 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Esfera Robotics R are ranked lower than 25 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak basic indicators, Esfera Robotics sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CM AM and Esfera Robotics

The main advantage of trading using opposite CM AM and Esfera Robotics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CM AM position performs unexpectedly, Esfera Robotics 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 Esfera Robotics will offset losses from the drop in Esfera Robotics' long position.

The idea behind CM AM Monplus NE and Esfera Robotics R pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.