Correlation Between Color Star and Comcast Corp

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

By analyzing existing cross correlation between Color Star Technology and Comcast Corp, you can compare the effects of market volatilities on Color Star and Comcast Corp 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 Color Star with a short position of Comcast Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Color Star and Comcast Corp.

Diversification Opportunities for Color Star and Comcast Corp

0.36

Correlation Coefficient

Color Star  Comcast Corp

Weak diversification

The 3 months correlation between Color and Comcast is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Color Star Technology and Comcast Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comcast Corp and Color Star 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 Color Star Technology are associated (or correlated) with Comcast Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comcast Corp has no effect on the direction of Color Star i.e., Color Star and Comcast Corp go up and down completely randomly.

Pair Corralation between Color Star and Comcast Corp

Considering the 90-day investment horizon Color Star Technology is expected to under-perform the Comcast Corp. In addition to that, Color Star is 2.77 times more volatile than Comcast Corp. It trades about -0.24 of its total potential returns per unit of risk. Comcast Corp is currently generating about 0.02 per unit of volatility. If you would invest  3,708  in Comcast Corp on December 29, 2024 and sell it today you would earn a total of  29.00  from holding Comcast Corp or generate 0.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Color Star Technology  vs.  Comcast Corp

Color Star Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Color Star Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Comcast Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Comcast Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Comcast Corp is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Color Star and Comcast Corp

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

The idea behind Color Star Technology and Comcast Corp 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.