Pair Correlation Between CVS Health and Alcoa

This module allows you to analyze existing cross correlation between CVS Health Corporation and Alcoa Inc. You can compare the effects of market volatilities on CVS Health and Alcoa 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 CVS Health with a short position of Alcoa. See also your portfolio center. Please also check ongoing floating volatility patterns of CVS Health and Alcoa.
Investment Horizon     30 Days    Login   to change
Symbolsvs
 CVS Health Corp.  vs   Alcoa Inc.
 Performance (%) 
Benchmark  Embed    Timeline 

Pair Volatility

Considering 30-days investment horizon, CVS Health is expected to generate 1.17 times less return on investment than Alcoa. But when comparing it to its historical volatility, CVS Health Corporation is 3.73 times less risky than Alcoa. It trades about 0.27 of its potential returns per unit of risk. Alcoa Inc is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  3,291  in Alcoa Inc on March 29, 2017 and sell it today you would earn a total of  161.00  from holding Alcoa Inc or generate 4.89% return on investment over 30 days.

Correlation Coefficient

Pair Corralation between CVS Health and Alcoa
0.49

Parameters

Time Period1 Month [change]
DirectionPositive 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Diversification

Very weak diversification

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

Comparative Volatility

 Predicted Return Density 
Benchmark  Embed    Returns 

CVS Health

  
18 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in CVS Health Corporation are ranked lower than 18 (%) of all global equities and portfolios over the last 30 days.

Alcoa Inc

  
5 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Alcoa Inc are ranked lower than 5 (%) of all global equities and portfolios over the last 30 days.