Correlation Between CeCors and Carl Zeiss

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

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

Diversification Opportunities for CeCors and Carl Zeiss

-0.79

Correlation Coefficient

CeCors  Carl Zeiss

Pay attention - limited upside

The 3 months correlation between CeCors and Carl is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding CeCors Inc and Carl Zeiss Meditec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carl Zeiss Meditec and CeCors 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 CeCors Inc are associated (or correlated) with Carl Zeiss. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carl Zeiss Meditec has no effect on the direction of CeCors i.e., CeCors and Carl Zeiss go up and down completely randomly.

Pair Corralation between CeCors and Carl Zeiss

Given the investment horizon of 90 days CeCors Inc is expected to under-perform the Carl Zeiss. In addition to that, CeCors is 5.23 times more volatile than Carl Zeiss Meditec. It trades about -0.05 of its total potential returns per unit of risk. Carl Zeiss Meditec is currently generating about 0.2 per unit of volatility. If you would invest  4,733  in Carl Zeiss Meditec on December 28, 2024 and sell it today you would earn a total of  2,320  from holding Carl Zeiss Meditec or generate 49.02% return on investment over 90 days.

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

CeCors Inc  vs.  Carl Zeiss Meditec

CeCors Inc

Risk-Adjusted Performance

Very Weak

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

Carl Zeiss Meditec

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Carl Zeiss Meditec are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Carl Zeiss showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CeCors and Carl Zeiss

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

The idea behind CeCors Inc and Carl Zeiss Meditec 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.