Correlation Between CEOTRONICS and Autodesk

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

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

Diversification Opportunities for CEOTRONICS and Autodesk

-0.9

Correlation Coefficient

CEOTRONICS  Autodesk

Pay attention - limited upside

The 3 months correlation between CEOTRONICS and Autodesk is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding CEOTRONICS and Autodesk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autodesk and CEOTRONICS 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 CEOTRONICS are associated (or correlated) with Autodesk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autodesk has no effect on the direction of CEOTRONICS i.e., CEOTRONICS and Autodesk go up and down completely randomly.

Pair Corralation between CEOTRONICS and Autodesk

Assuming the 90 days trading horizon CEOTRONICS is expected to generate 2.19 times more return on investment than Autodesk. However, CEOTRONICS is 2.19 times more volatile than Autodesk. It trades about 0.21 of its potential returns per unit of risk. Autodesk is currently generating about -0.11 per unit of risk. If you would invest  575.00  in CEOTRONICS on December 24, 2024 and sell it today you would earn a total of  380.00  from holding CEOTRONICS or generate 66.09% return on investment over 90 days.

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

CEOTRONICS  vs.  Autodesk

CEOTRONICS

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in CEOTRONICS are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, CEOTRONICS unveiled solid returns over the last few months and may actually be approaching a breakup point.

Autodesk

Risk-Adjusted Performance

Very Weak

Over the last 90 days Autodesk has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with CEOTRONICS and Autodesk

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

The idea behind CEOTRONICS and Autodesk 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.