Correlation Between MASSIN and CECO Environmental

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

By analyzing existing cross correlation between MASSIN 3067 01 APR 52 and CECO Environmental Corp, you can compare the effects of market volatilities on MASSIN and CECO Environmental 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 MASSIN with a short position of CECO Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of MASSIN and CECO Environmental.

Diversification Opportunities for MASSIN and CECO Environmental

-0.55

Correlation Coefficient

MASSIN  CECO Environmental

Excellent diversification

The 3 months correlation between MASSIN and CECO is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding MASSIN 3067 01 APR 52 and CECO Environmental Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CECO Environmental Corp and MASSIN 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 MASSIN 3067 01 APR 52 are associated (or correlated) with CECO Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CECO Environmental Corp has no effect on the direction of MASSIN i.e., MASSIN and CECO Environmental go up and down completely randomly.

Pair Corralation between MASSIN and CECO Environmental

Assuming the 90 days trading horizon MASSIN 3067 01 APR 52 is expected to under-perform the CECO Environmental. In addition to that, MASSIN is 1.29 times more volatile than CECO Environmental Corp. It trades about -0.01 of its total potential returns per unit of risk. CECO Environmental Corp is currently generating about 0.04 per unit of volatility. If you would invest  2,820  in CECO Environmental Corp on September 29, 2024 and sell it today you would earn a total of  127.00  from holding CECO Environmental Corp or generate 4.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	49.21%
Values	Daily Returns

MASSIN 3067 01 APR 52  vs.  CECO Environmental Corp

MASSIN 3067 01

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MASSIN 3067 01 APR 52 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, MASSIN is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

CECO Environmental Corp

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CECO Environmental Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain fundamental indicators, CECO Environmental may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with MASSIN and CECO Environmental

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

The idea behind MASSIN 3067 01 APR 52 and CECO Environmental Corp 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.