Correlation Between Cintas and Excel Corp

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

Diversification Opportunities for Cintas and Excel Corp

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Cintas and Excel is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cintas and Excel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Excel Corp and Cintas 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 Cintas are associated (or correlated) with Excel Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Excel Corp has no effect on the direction of Cintas i.e., Cintas and Excel Corp go up and down completely randomly.

Pair Corralation between Cintas and Excel Corp

If you would invest  63,072  in Cintas on December 30, 2023 and sell it today you would earn a total of  5,631  from holding Cintas or generate 8.93% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Cintas  vs.  Excel Corp

 Performance 
       Timeline  
Cintas 

Risk-Adjusted Performance

15 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Cintas are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Cintas unveiled solid returns over the last few months and may actually be approaching a breakup point.
Excel Corp 

Risk-Adjusted Performance

0 of 100

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

Cintas and Excel Corp Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Cintas and Excel Corp

The main advantage of trading using opposite Cintas and Excel Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cintas position performs unexpectedly, Excel Corp 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 Excel Corp will offset losses from the drop in Excel Corp's long position.
The idea behind Cintas and Excel 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.

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