Correlation Between CBO Territoria and Antin IP

Can any of the company-specific risk be diversified away by investing in both CBO Territoria and Antin IP 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 CBO Territoria and Antin IP into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CBO Territoria SA and Antin IP SA, you can compare the effects of market volatilities on CBO Territoria and Antin IP 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 CBO Territoria with a short position of Antin IP. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBO Territoria and Antin IP.

Diversification Opportunities for CBO Territoria and Antin IP

0.36

Correlation Coefficient

CBO Territoria  Antin IP

Weak diversification

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

Pair Corralation between CBO Territoria and Antin IP

Assuming the 90 days trading horizon CBO Territoria SA is expected to generate 0.2 times more return on investment than Antin IP. However, CBO Territoria SA is 5.09 times less risky than Antin IP. It trades about -0.06 of its potential returns per unit of risk. Antin IP SA is currently generating about -0.03 per unit of risk. If you would invest  360.00  in CBO Territoria SA on September 16, 2024 and sell it today you would lose (6.00) from holding CBO Territoria SA or give up 1.67% of portfolio value over 90 days.

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

CBO Territoria SA  vs.  Antin IP SA

CBO Territoria SA

Risk-Adjusted Performance

0 of 100

Very Weak

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

Antin IP SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Antin IP SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Antin IP is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with CBO Territoria and Antin IP

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

The idea behind CBO Territoria SA and Antin IP SA 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.