Correlation Between Comstock Holding and American Environmental

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

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

Diversification Opportunities for Comstock Holding and American Environmental

0.0

Correlation Coefficient

Comstock Holding  American Environmental

Pay attention - limited upside

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

Pair Corralation between Comstock Holding and American Environmental

If you would invest  0.01  in American Environmental on October 23, 2024 and sell it today you would earn a total of  0.00  from holding American Environmental or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Comstock Holding Companies  vs.  American Environmental

Comstock Holding Com

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Comstock Holding Companies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

American Environmental

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days American Environmental has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, American Environmental is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Comstock Holding and American Environmental

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

The idea behind Comstock Holding Companies and American Environmental 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.