Correlation Between CAMP4 THERAPEUTICS and Ituran Location

Can any of the company-specific risk be diversified away by investing in both CAMP4 THERAPEUTICS and Ituran Location 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 CAMP4 THERAPEUTICS and Ituran Location into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CAMP4 THERAPEUTICS PORATION and Ituran Location and, you can compare the effects of market volatilities on CAMP4 THERAPEUTICS and Ituran Location 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 CAMP4 THERAPEUTICS with a short position of Ituran Location. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAMP4 THERAPEUTICS and Ituran Location.

Diversification Opportunities for CAMP4 THERAPEUTICS and Ituran Location

0.17

Correlation Coefficient

CAMP4 THERAPEUTICS  Ituran Location

Average diversification

The 3 months correlation between CAMP4 and Ituran is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding CAMP4 THERAPEUTICS PORATION and Ituran Location and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ituran Location and CAMP4 THERAPEUTICS 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 CAMP4 THERAPEUTICS PORATION are associated (or correlated) with Ituran Location. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ituran Location has no effect on the direction of CAMP4 THERAPEUTICS i.e., CAMP4 THERAPEUTICS and Ituran Location go up and down completely randomly.

Pair Corralation between CAMP4 THERAPEUTICS and Ituran Location

Given the investment horizon of 90 days CAMP4 THERAPEUTICS PORATION is expected to generate 11.27 times more return on investment than Ituran Location. However, CAMP4 THERAPEUTICS is 11.27 times more volatile than Ituran Location and. It trades about 0.07 of its potential returns per unit of risk. Ituran Location and is currently generating about 0.27 per unit of risk. If you would invest  533.00  in CAMP4 THERAPEUTICS PORATION on September 21, 2024 and sell it today you would lose (13.00) from holding CAMP4 THERAPEUTICS PORATION or give up 2.44% of portfolio value over 90 days.

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

CAMP4 THERAPEUTICS PORATION  vs.  Ituran Location and

CAMP4 THERAPEUTICS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CAMP4 THERAPEUTICS PORATION has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's primary indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Ituran Location

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ituran Location and are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Ituran Location displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CAMP4 THERAPEUTICS and Ituran Location

The main advantage of trading using opposite CAMP4 THERAPEUTICS and Ituran Location positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAMP4 THERAPEUTICS position performs unexpectedly, Ituran Location 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 Ituran Location will offset losses from the drop in Ituran Location's long position.

The idea behind CAMP4 THERAPEUTICS PORATION and Ituran Location and 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.