Correlation Between Weyco and Comstock Holding

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

By analyzing existing cross correlation between Weyco Group and Comstock Holding Companies, you can compare the effects of market volatilities on Weyco and Comstock Holding 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 Weyco with a short position of Comstock Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weyco and Comstock Holding.

Diversification Opportunities for Weyco and Comstock Holding

-0.3

Correlation Coefficient

Weyco  Comstock Holding

Very good diversification

The 3 months correlation between Weyco and Comstock is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Weyco Group and Comstock Holding Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Holding Com and Weyco 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 Weyco Group are associated (or correlated) with Comstock Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Holding Com has no effect on the direction of Weyco i.e., Weyco and Comstock Holding go up and down completely randomly.

Pair Corralation between Weyco and Comstock Holding

Given the investment horizon of 90 days Weyco Group is expected to generate 0.66 times more return on investment than Comstock Holding. However, Weyco Group is 1.53 times less risky than Comstock Holding. It trades about 0.06 of its potential returns per unit of risk. Comstock Holding Companies is currently generating about 0.02 per unit of risk. If you would invest  3,321  in Weyco Group on September 15, 2024 and sell it today you would earn a total of  289.00  from holding Weyco Group or generate 8.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Weyco Group  vs.  Comstock Holding Companies

Weyco Group

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Weyco Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Weyco may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Comstock Holding Com

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Comstock Holding Companies are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, Comstock Holding is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Weyco and Comstock Holding

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

The idea behind Weyco Group and Comstock Holding Companies 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.