Correlation Between CPI Computer and Mytilineos
Can any of the company-specific risk be diversified away by investing in both CPI Computer and Mytilineos 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 CPI Computer and Mytilineos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPI Computer Peripherals and Mytilineos SA, you can compare the effects of market volatilities on CPI Computer and Mytilineos 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 CPI Computer with a short position of Mytilineos. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPI Computer and Mytilineos.
Diversification Opportunities for CPI Computer and Mytilineos
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between CPI and Mytilineos is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding CPI Computer Peripherals and Mytilineos SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mytilineos SA and CPI Computer 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 CPI Computer Peripherals are associated (or correlated) with Mytilineos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mytilineos SA has no effect on the direction of CPI Computer i.e., CPI Computer and Mytilineos go up and down completely randomly.
Pair Corralation between CPI Computer and Mytilineos
Assuming the 90 days trading horizon CPI Computer Peripherals is expected to under-perform the Mytilineos. In addition to that, CPI Computer is 1.8 times more volatile than Mytilineos SA. It trades about -0.14 of its total potential returns per unit of risk. Mytilineos SA is currently generating about -0.12 per unit of volatility. If you would invest 3,670 in Mytilineos SA on April 4, 2024 and sell it today you would lose (124.00) from holding Mytilineos SA or give up 3.38% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
CPI Computer Peripherals vs. Mytilineos SA
Performance |
Timeline |
CPI Computer Peripherals |
Mytilineos SA |
CPI Computer and Mytilineos Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CPI Computer and Mytilineos
The main advantage of trading using opposite CPI Computer and Mytilineos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPI Computer position performs unexpectedly, Mytilineos 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 Mytilineos will offset losses from the drop in Mytilineos' long position.CPI Computer vs. Quest Holdings SA | CPI Computer vs. Performance Technologies SA | CPI Computer vs. National Bank of | CPI Computer vs. Lampsa Hellenic Hotels |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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