Correlation Between CDW Corp and Greene King

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

By analyzing existing cross correlation between CDW Corp and Greene King Plc, you can compare the effects of market volatilities on CDW Corp and Greene King 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 Greene King. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDW Corp and Greene King.

Diversification Opportunities for CDW Corp and Greene King

0.0

Correlation Coefficient

CDW Corp  Greene King

Pay attention - limited upside

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

Pair Corralation between CDW Corp and Greene King

If you would invest  22,147  in CDW Corp on March 13, 2024 and sell it today you would earn a total of  243.00  from holding CDW Corp or generate 1.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.0%
Values	Daily Returns

CDW Corp  vs.  Greene King Plc

CDW Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CDW Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's fundamental indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Greene King Plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Greene King Plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical and fundamental indicators, Greene King is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with CDW Corp and Greene King

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

The idea behind CDW Corp and Greene King Plc 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..