Correlation Between California-Engels and 26442CAH7

Can any of the company-specific risk be diversified away by investing in both California-Engels and 26442CAH7 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 California-Engels and 26442CAH7 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between California Engels Mining and DUKE ENERGY CAROLINAS, you can compare the effects of market volatilities on California-Engels and 26442CAH7 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 California-Engels with a short position of 26442CAH7. Check out your portfolio center. Please also check ongoing floating volatility patterns of California-Engels and 26442CAH7.

Diversification Opportunities for California-Engels and 26442CAH7

0.0

Correlation Coefficient

California-Engels  26442CAH7

Pay attention - limited upside

The 3 months correlation between California-Engels and 26442CAH7 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding California Engels Mining and DUKE ENERGY CAROLINAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DUKE ENERGY CAROLINAS and California-Engels 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 California Engels Mining are associated (or correlated) with 26442CAH7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DUKE ENERGY CAROLINAS has no effect on the direction of California-Engels i.e., California-Engels and 26442CAH7 go up and down completely randomly.

Pair Corralation between California-Engels and 26442CAH7

If you would invest  10,044  in DUKE ENERGY CAROLINAS on October 25, 2024 and sell it today you would lose (19.00) from holding DUKE ENERGY CAROLINAS or give up 0.19% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	92.06%
Values	Daily Returns

California Engels Mining  vs.  DUKE ENERGY CAROLINAS

California Engels Mining

Risk-Adjusted Performance

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Very Weak

Over the last 90 days California Engels Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, California-Engels is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

DUKE ENERGY CAROLINAS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DUKE ENERGY CAROLINAS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 26442CAH7 is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with California-Engels and 26442CAH7

The main advantage of trading using opposite California-Engels and 26442CAH7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if California-Engels position performs unexpectedly, 26442CAH7 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 26442CAH7 will offset losses from the drop in 26442CAH7's long position.

The idea behind California Engels Mining and DUKE ENERGY CAROLINAS 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.