Correlation Between Captivision Ordinary and Eagle Materials

Can any of the company-specific risk be diversified away by investing in both Captivision Ordinary and Eagle Materials 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 Captivision Ordinary and Eagle Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Captivision Ordinary Shares and Eagle Materials, you can compare the effects of market volatilities on Captivision Ordinary and Eagle Materials 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 Captivision Ordinary with a short position of Eagle Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Captivision Ordinary and Eagle Materials.

Diversification Opportunities for Captivision Ordinary and Eagle Materials

-0.67

Correlation Coefficient

Captivision Ordinary  Eagle Materials

Excellent diversification

The 3 months correlation between Captivision and Eagle is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Captivision Ordinary Shares and Eagle Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Materials and Captivision Ordinary 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 Captivision Ordinary Shares are associated (or correlated) with Eagle Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Materials has no effect on the direction of Captivision Ordinary i.e., Captivision Ordinary and Eagle Materials go up and down completely randomly.

Pair Corralation between Captivision Ordinary and Eagle Materials

Given the investment horizon of 90 days Captivision Ordinary Shares is expected to under-perform the Eagle Materials. In addition to that, Captivision Ordinary is 4.72 times more volatile than Eagle Materials. It trades about -0.16 of its total potential returns per unit of risk. Eagle Materials is currently generating about 0.03 per unit of volatility. If you would invest  27,044  in Eagle Materials on September 13, 2024 and sell it today you would earn a total of  711.00  from holding Eagle Materials or generate 2.63% return on investment over 90 days.

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

Captivision Ordinary Shares  vs.  Eagle Materials

Captivision Ordinary

Risk-Adjusted Performance

0 of 100

Very Weak

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

Eagle Materials

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Eagle Materials are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Eagle Materials is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Captivision Ordinary and Eagle Materials

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

The idea behind Captivision Ordinary Shares and Eagle Materials 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 CEOs Directory module to screen CEOs from public companies around the world.