Correlation Between Armada Hflr and CSIF I

Can any of the company-specific risk be diversified away by investing in both Armada Hflr and CSIF I 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 Armada Hflr and CSIF I into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Armada Hflr Pr and CSIF I Equity, you can compare the effects of market volatilities on Armada Hflr and CSIF I 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 Armada Hflr with a short position of CSIF I. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and CSIF I.

Diversification Opportunities for Armada Hflr and CSIF I

-0.09

Correlation Coefficient

Armada Hflr  CSIF I

Good diversification

The 3 months correlation between Armada and CSIF is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and CSIF I Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSIF I Equity and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with CSIF I. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSIF I Equity has no effect on the direction of Armada Hflr i.e., Armada Hflr and CSIF I go up and down completely randomly.

Pair Corralation between Armada Hflr and CSIF I

Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the CSIF I. In addition to that, Armada Hflr is 1.81 times more volatile than CSIF I Equity. It trades about 0.0 of its total potential returns per unit of risk. CSIF I Equity is currently generating about 0.03 per unit of volatility. If you would invest  87,221  in CSIF I Equity on October 15, 2024 and sell it today you would earn a total of  11,526  from holding CSIF I Equity or generate 13.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.19%
Values	Daily Returns

Armada Hflr Pr  vs.  CSIF I Equity

Armada Hflr Pr

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Armada Hflr Pr has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

CSIF I Equity

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CSIF I Equity has generated negative risk-adjusted returns adding no value to fund investors. Despite fairly strong forward indicators, CSIF I is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Armada Hflr and CSIF I

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

The idea behind Armada Hflr Pr and CSIF I Equity 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.