Correlation Between Cannae Holdings and 494368CA9

Can any of the company-specific risk be diversified away by investing in both Cannae Holdings and 494368CA9 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 Cannae Holdings and 494368CA9 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cannae Holdings and US494368CA98, you can compare the effects of market volatilities on Cannae Holdings and 494368CA9 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 Cannae Holdings with a short position of 494368CA9. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cannae Holdings and 494368CA9.

Diversification Opportunities for Cannae Holdings and 494368CA9

-0.6

Correlation Coefficient

Cannae Holdings  494368CA9

Excellent diversification

The 3 months correlation between Cannae and 494368CA9 is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Cannae Holdings and US494368CA98 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US494368CA98 and Cannae Holdings 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 Cannae Holdings are associated (or correlated) with 494368CA9. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US494368CA98 has no effect on the direction of Cannae Holdings i.e., Cannae Holdings and 494368CA9 go up and down completely randomly.

Pair Corralation between Cannae Holdings and 494368CA9

Given the investment horizon of 90 days Cannae Holdings is expected to generate 0.93 times more return on investment than 494368CA9. However, Cannae Holdings is 1.07 times less risky than 494368CA9. It trades about 0.06 of its potential returns per unit of risk. US494368CA98 is currently generating about -0.07 per unit of risk. If you would invest  1,946  in Cannae Holdings on September 15, 2024 and sell it today you would earn a total of  110.00  from holding Cannae Holdings or generate 5.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	64.06%
Values	Daily Returns

Cannae Holdings  vs.  US494368CA98

Cannae Holdings

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Cannae Holdings are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Cannae Holdings is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

US494368CA98

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days US494368CA98 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for US494368CA98 investors.

Pair Trading with Cannae Holdings and 494368CA9

The main advantage of trading using opposite Cannae Holdings and 494368CA9 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cannae Holdings position performs unexpectedly, 494368CA9 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 494368CA9 will offset losses from the drop in 494368CA9's long position.

The idea behind Cannae Holdings and US494368CA98 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 Anywhere module to track or share privately all of your investments from the convenience of any device.