Correlation Between CB Industrial and Uwc Bhd

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both CB Industrial and Uwc Bhd 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 CB Industrial and Uwc Bhd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CB Industrial Product and Uwc Bhd, you can compare the effects of market volatilities on CB Industrial and Uwc Bhd 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 CB Industrial with a short position of Uwc Bhd. Check out your portfolio center. Please also check ongoing floating volatility patterns of CB Industrial and Uwc Bhd.

Diversification Opportunities for CB Industrial and Uwc Bhd

0.32
  Correlation Coefficient

Weak diversification

The 3 months correlation between 7076 and Uwc is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding CB Industrial Product and Uwc Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uwc Bhd and CB Industrial 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 CB Industrial Product are associated (or correlated) with Uwc Bhd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uwc Bhd has no effect on the direction of CB Industrial i.e., CB Industrial and Uwc Bhd go up and down completely randomly.

Pair Corralation between CB Industrial and Uwc Bhd

Assuming the 90 days trading horizon CB Industrial Product is expected to generate 0.66 times more return on investment than Uwc Bhd. However, CB Industrial Product is 1.53 times less risky than Uwc Bhd. It trades about 0.01 of its potential returns per unit of risk. Uwc Bhd is currently generating about -0.04 per unit of risk. If you would invest  128.00  in CB Industrial Product on September 12, 2024 and sell it today you would earn a total of  2.00  from holding CB Industrial Product or generate 1.56% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy99.18%
ValuesDaily Returns

CB Industrial Product  vs.  Uwc Bhd

 Performance 
       Timeline  
CB Industrial Product 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days CB Industrial Product has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, CB Industrial is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.
Uwc Bhd 

Risk-Adjusted Performance

13 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Uwc Bhd are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Uwc Bhd disclosed solid returns over the last few months and may actually be approaching a breakup point.

CB Industrial and Uwc Bhd Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with CB Industrial and Uwc Bhd

The main advantage of trading using opposite CB Industrial and Uwc Bhd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CB Industrial position performs unexpectedly, Uwc Bhd 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 Uwc Bhd will offset losses from the drop in Uwc Bhd's long position.
The idea behind CB Industrial Product and Uwc Bhd 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.
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.

Other Complementary Tools

Latest Portfolios
Quick portfolio dashboard that showcases your latest portfolios
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences