Correlation Between Ceragon Networks and Malacca Straits
Can any of the company-specific risk be diversified away by investing in both Ceragon Networks and Malacca Straits 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 Ceragon Networks and Malacca Straits into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ceragon Networks and Malacca Straits Acquisition, you can compare the effects of market volatilities on Ceragon Networks and Malacca Straits 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 Ceragon Networks with a short position of Malacca Straits. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceragon Networks and Malacca Straits.
Diversification Opportunities for Ceragon Networks and Malacca Straits
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ceragon and Malacca is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Ceragon Networks and Malacca Straits Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malacca Straits Acqu and Ceragon Networks 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 Ceragon Networks are associated (or correlated) with Malacca Straits. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malacca Straits Acqu has no effect on the direction of Ceragon Networks i.e., Ceragon Networks and Malacca Straits go up and down completely randomly.
Pair Corralation between Ceragon Networks and Malacca Straits
Given the investment horizon of 90 days Ceragon Networks is expected to generate 24.14 times less return on investment than Malacca Straits. But when comparing it to its historical volatility, Ceragon Networks is 16.18 times less risky than Malacca Straits. It trades about 0.07 of its potential returns per unit of risk. Malacca Straits Acquisition is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 3.00 in Malacca Straits Acquisition on September 10, 2024 and sell it today you would lose (2.86) from holding Malacca Straits Acquisition or give up 95.33% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 16.36% |
Values | Daily Returns |
Ceragon Networks vs. Malacca Straits Acquisition
Performance |
Timeline |
Ceragon Networks |
Malacca Straits Acqu |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ceragon Networks and Malacca Straits Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ceragon Networks and Malacca Straits
The main advantage of trading using opposite Ceragon Networks and Malacca Straits positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceragon Networks position performs unexpectedly, Malacca Straits 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 Malacca Straits will offset losses from the drop in Malacca Straits' long position.Ceragon Networks vs. Cambium Networks Corp | Ceragon Networks vs. KVH Industries | Ceragon Networks vs. Knowles Cor | Ceragon Networks vs. AudioCodes |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |