Correlation Between CBIZ and YY Group

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Can any of the company-specific risk be diversified away by investing in both CBIZ and YY Group 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 CBIZ and YY Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CBIZ Inc and YY Group Holding, you can compare the effects of market volatilities on CBIZ and YY Group 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 CBIZ with a short position of YY Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBIZ and YY Group.

Diversification Opportunities for CBIZ and YY Group

0.8
  Correlation Coefficient

Very poor diversification

The 3 months correlation between CBIZ and YYGH is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding CBIZ Inc and YY Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YY Group Holding and CBIZ 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 CBIZ Inc are associated (or correlated) with YY Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YY Group Holding has no effect on the direction of CBIZ i.e., CBIZ and YY Group go up and down completely randomly.

Pair Corralation between CBIZ and YY Group

Considering the 90-day investment horizon CBIZ Inc is expected to generate 0.31 times more return on investment than YY Group. However, CBIZ Inc is 3.28 times less risky than YY Group. It trades about 0.24 of its potential returns per unit of risk. YY Group Holding is currently generating about -0.13 per unit of risk. If you would invest  8,062  in CBIZ Inc on October 22, 2024 and sell it today you would earn a total of  388.00  from holding CBIZ Inc or generate 4.81% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

CBIZ Inc  vs.  YY Group Holding

 Performance 
       Timeline  
CBIZ Inc 

Risk-Adjusted Performance

18 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in CBIZ Inc are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental drivers, CBIZ showed solid returns over the last few months and may actually be approaching a breakup point.
YY Group Holding 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in YY Group Holding are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent technical and fundamental indicators, YY Group demonstrated solid returns over the last few months and may actually be approaching a breakup point.

CBIZ and YY Group Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with CBIZ and YY Group

The main advantage of trading using opposite CBIZ and YY Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBIZ position performs unexpectedly, YY Group 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 YY Group will offset losses from the drop in YY Group's long position.
The idea behind CBIZ Inc and YY Group Holding 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.
Check out your portfolio center.
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.

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