Correlation Between Continental Beverage and CTR Investments

Can any of the company-specific risk be diversified away by investing in both Continental Beverage and CTR Investments 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 Continental Beverage and CTR Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Continental Beverage Brands and CTR Investments Consulting, you can compare the effects of market volatilities on Continental Beverage and CTR Investments 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 Continental Beverage with a short position of CTR Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Continental Beverage and CTR Investments.

Diversification Opportunities for Continental Beverage and CTR Investments

0.0

Correlation Coefficient

Continental Beverage  CTR Investments

Pay attention - limited upside

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

Pair Corralation between Continental Beverage and CTR Investments

If you would invest  0.02  in CTR Investments Consulting on December 29, 2024 and sell it today you would earn a total of  0.01  from holding CTR Investments Consulting or generate 50.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Continental Beverage Brands  vs.  CTR Investments Consulting

Continental Beverage

Risk-Adjusted Performance

Very Weak

Over the last 90 days Continental Beverage Brands has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, Continental Beverage is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

CTR Investments Cons

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CTR Investments Consulting are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, CTR Investments showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Continental Beverage and CTR Investments

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

The idea behind Continental Beverage Brands and CTR Investments Consulting 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.