Correlation Between Western Investment and INTEL CDR

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Western Investment and INTEL CDR 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 Western Investment and INTEL CDR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Investment and INTEL CDR, you can compare the effects of market volatilities on Western Investment and INTEL CDR 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 Western Investment with a short position of INTEL CDR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Investment and INTEL CDR.

Diversification Opportunities for Western Investment and INTEL CDR

-0.4
  Correlation Coefficient

Very good diversification

The 3 months correlation between Western and INTEL is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Western Investment and INTEL CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTEL CDR and Western Investment 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 Western Investment are associated (or correlated) with INTEL CDR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTEL CDR has no effect on the direction of Western Investment i.e., Western Investment and INTEL CDR go up and down completely randomly.

Pair Corralation between Western Investment and INTEL CDR

Given the investment horizon of 90 days Western Investment is expected to generate 1.71 times more return on investment than INTEL CDR. However, Western Investment is 1.71 times more volatile than INTEL CDR. It trades about 0.07 of its potential returns per unit of risk. INTEL CDR is currently generating about -0.02 per unit of risk. If you would invest  42.00  in Western Investment on September 17, 2024 and sell it today you would earn a total of  7.00  from holding Western Investment or generate 16.67% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Western Investment  vs.  INTEL CDR

 Performance 
       Timeline  
Western Investment 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Western Investment are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Western Investment showed solid returns over the last few months and may actually be approaching a breakup point.
INTEL CDR 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days INTEL CDR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, INTEL CDR is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Western Investment and INTEL CDR Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Western Investment and INTEL CDR

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

Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.