Correlation Between Ross Stores and Calculus VCT

Can any of the company-specific risk be diversified away by investing in both Ross Stores and Calculus VCT 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 Ross Stores and Calculus VCT into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ross Stores and Calculus VCT plc, you can compare the effects of market volatilities on Ross Stores and Calculus VCT 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 Ross Stores with a short position of Calculus VCT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and Calculus VCT.

Diversification Opportunities for Ross Stores and Calculus VCT

-0.77

Correlation Coefficient

Ross Stores  Calculus VCT

Pay attention - limited upside

The 3 months correlation between Ross and Calculus is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and Calculus VCT plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calculus VCT plc and Ross Stores 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 Ross Stores are associated (or correlated) with Calculus VCT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calculus VCT plc has no effect on the direction of Ross Stores i.e., Ross Stores and Calculus VCT go up and down completely randomly.

Pair Corralation between Ross Stores and Calculus VCT

Assuming the 90 days trading horizon Ross Stores is expected to under-perform the Calculus VCT. In addition to that, Ross Stores is 1.25 times more volatile than Calculus VCT plc. It trades about -0.18 of its total potential returns per unit of risk. Calculus VCT plc is currently generating about 0.16 per unit of volatility. If you would invest  4,994  in Calculus VCT plc on December 24, 2024 and sell it today you would earn a total of  506.00  from holding Calculus VCT plc or generate 10.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	96.88%
Values	Daily Returns

Ross Stores  vs.  Calculus VCT plc

Ross Stores

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ross Stores has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Calculus VCT plc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Calculus VCT plc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Calculus VCT may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Ross Stores and Calculus VCT

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

The idea behind Ross Stores and Calculus VCT 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.