Correlation Between Cion Investment and Vinci Partners

Can any of the company-specific risk be diversified away by investing in both Cion Investment and Vinci Partners 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 Cion Investment and Vinci Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cion Investment Corp and Vinci Partners Investments, you can compare the effects of market volatilities on Cion Investment and Vinci Partners 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 Cion Investment with a short position of Vinci Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cion Investment and Vinci Partners.

Diversification Opportunities for Cion Investment and Vinci Partners

-0.37

Correlation Coefficient

Cion Investment  Vinci Partners

Very good diversification

The 3 months correlation between Cion and Vinci is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Cion Investment Corp and Vinci Partners Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vinci Partners Inves and Cion Investment 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 Cion Investment Corp are associated (or correlated) with Vinci Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vinci Partners Inves has no effect on the direction of Cion Investment i.e., Cion Investment and Vinci Partners go up and down completely randomly.

Pair Corralation between Cion Investment and Vinci Partners

Given the investment horizon of 90 days Cion Investment is expected to generate 1.01 times less return on investment than Vinci Partners. But when comparing it to its historical volatility, Cion Investment Corp is 1.17 times less risky than Vinci Partners. It trades about 0.02 of its potential returns per unit of risk. Vinci Partners Investments is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  1,026  in Vinci Partners Investments on September 1, 2024 and sell it today you would earn a total of  3.00  from holding Vinci Partners Investments or generate 0.29% return on investment over 90 days.

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

Cion Investment Corp  vs.  Vinci Partners Investments

Cion Investment Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cion Investment Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Cion Investment is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Vinci Partners Inves

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Vinci Partners Investments are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Vinci Partners is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Cion Investment and Vinci Partners

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

The idea behind Cion Investment Corp and Vinci Partners Investments 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.