Correlation Between CDW Corp and Computer Task
Can any of the company-specific risk be diversified away by investing in both CDW Corp and Computer Task 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 CDW Corp and Computer Task into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CDW Corp and Computer Task Group, you can compare the effects of market volatilities on CDW Corp and Computer Task 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 CDW Corp with a short position of Computer Task. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDW Corp and Computer Task.
Diversification Opportunities for CDW Corp and Computer Task
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CDW and Computer is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding CDW Corp and Computer Task Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Task Group and CDW Corp 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 CDW Corp are associated (or correlated) with Computer Task. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Task Group has no effect on the direction of CDW Corp i.e., CDW Corp and Computer Task go up and down completely randomly.
Pair Corralation between CDW Corp and Computer Task
Considering the 90-day investment horizon CDW Corp is expected to generate 1.82 times less return on investment than Computer Task. But when comparing it to its historical volatility, CDW Corp is 1.69 times less risky than Computer Task. It trades about 0.07 of its potential returns per unit of risk. Computer Task Group is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 713.00 in Computer Task Group on January 31, 2024 and sell it today you would earn a total of 337.00 from holding Computer Task Group or generate 47.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 72.04% |
Values | Daily Returns |
CDW Corp vs. Computer Task Group
Performance |
Timeline |
CDW Corp |
Computer Task Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
CDW Corp and Computer Task Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CDW Corp and Computer Task
The main advantage of trading using opposite CDW Corp and Computer Task positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CDW Corp position performs unexpectedly, Computer Task 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 Computer Task will offset losses from the drop in Computer Task's long position.CDW Corp vs. Ubiquiti Networks | CDW Corp vs. Viavi Solutions | CDW Corp vs. Vislink Technologies | CDW Corp vs. DZS Inc |
Computer Task vs. The Hackett Group | Computer Task vs. CSP Inc | Computer Task vs. Clarivate Plc | Computer Task vs. Nayax |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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