Correlation Between Coroware and CN Energy
Can any of the company-specific risk be diversified away by investing in both Coroware and CN Energy 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 Coroware and CN Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coroware and CN Energy Group, you can compare the effects of market volatilities on Coroware and CN Energy 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 Coroware with a short position of CN Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coroware and CN Energy.
Diversification Opportunities for Coroware and CN Energy
Good diversification
The 3 months correlation between Coroware and CNEY is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Coroware and CN Energy Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CN Energy Group and Coroware 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 Coroware are associated (or correlated) with CN Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CN Energy Group has no effect on the direction of Coroware i.e., Coroware and CN Energy go up and down completely randomly.
Pair Corralation between Coroware and CN Energy
Given the investment horizon of 90 days Coroware is expected to generate 8.32 times more return on investment than CN Energy. However, Coroware is 8.32 times more volatile than CN Energy Group. It trades about 0.41 of its potential returns per unit of risk. CN Energy Group is currently generating about 0.11 per unit of risk. If you would invest 0.01 in Coroware on September 5, 2024 and sell it today you would lose (0.01) from holding Coroware or give up 100.0% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.46% |
Values | Daily Returns |
Coroware vs. CN Energy Group
Performance |
Timeline |
Coroware |
CN Energy Group |
Coroware and CN Energy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Coroware and CN Energy
The main advantage of trading using opposite Coroware and CN Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coroware position performs unexpectedly, CN Energy 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 CN Energy will offset losses from the drop in CN Energy's long position.Coroware vs. Avoca LLC | Coroware vs. Nocopi Technologies | Coroware vs. Blue Biofuels | Coroware vs. Lhyfe SA |
CN Energy vs. SenesTech | CN Energy vs. Danimer Scientific | CN Energy vs. C Bond Systems | CN Energy vs. Coroware |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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