Correlation Between Casio Computer and Pinterest

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

By analyzing existing cross correlation between Casio Computer Co and Pinterest, you can compare the effects of market volatilities on Casio Computer and Pinterest 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 Casio Computer with a short position of Pinterest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Casio Computer and Pinterest.

Diversification Opportunities for Casio Computer and Pinterest

0.26

Correlation Coefficient

Casio Computer  Pinterest

Modest diversification

The 3 months correlation between Casio and Pinterest is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Casio Computer Co and Pinterest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinterest and Casio Computer 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 Casio Computer Co are associated (or correlated) with Pinterest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinterest has no effect on the direction of Casio Computer i.e., Casio Computer and Pinterest go up and down completely randomly.

Pair Corralation between Casio Computer and Pinterest

Assuming the 90 days horizon Casio Computer Co is expected to under-perform the Pinterest. In addition to that, Casio Computer is 1.12 times more volatile than Pinterest. It trades about -0.04 of its total potential returns per unit of risk. Pinterest is currently generating about -0.01 per unit of volatility. If you would invest  3,131  in Pinterest on August 31, 2024 and sell it today you would lose (99.00) from holding Pinterest or give up 3.16% of portfolio value over 90 days.

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

Casio Computer Co  vs.  Pinterest

Casio Computer

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Casio Computer Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pinterest

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pinterest has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Pinterest is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Casio Computer and Pinterest

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

The idea behind Casio Computer Co and Pinterest 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 Stocks Directory module to find actively traded stocks across global markets.