Correlation Between Cicor Technologies and Basler Kantonalbank

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

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

Diversification Opportunities for Cicor Technologies and Basler Kantonalbank

0.59

Correlation Coefficient

Cicor Technologies  Basler Kantonalbank

Very weak diversification

The 3 months correlation between Cicor and Basler is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Cicor Technologies and Basler Kantonalbank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Basler Kantonalbank and Cicor Technologies 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 Cicor Technologies are associated (or correlated) with Basler Kantonalbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Basler Kantonalbank has no effect on the direction of Cicor Technologies i.e., Cicor Technologies and Basler Kantonalbank go up and down completely randomly.

Pair Corralation between Cicor Technologies and Basler Kantonalbank

Assuming the 90 days trading horizon Cicor Technologies is expected to generate 1.45 times more return on investment than Basler Kantonalbank. However, Cicor Technologies is 1.45 times more volatile than Basler Kantonalbank. It trades about 0.04 of its potential returns per unit of risk. Basler Kantonalbank is currently generating about 0.05 per unit of risk. If you would invest  4,740  in Cicor Technologies on October 11, 2024 and sell it today you would earn a total of  1,240  from holding Cicor Technologies or generate 26.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.8%
Values	Daily Returns

Cicor Technologies  vs.  Basler Kantonalbank

Cicor Technologies

Risk-Adjusted Performance

10 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cicor Technologies are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Cicor Technologies showed solid returns over the last few months and may actually be approaching a breakup point.

Basler Kantonalbank

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Basler Kantonalbank are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Basler Kantonalbank may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Cicor Technologies and Basler Kantonalbank

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

The idea behind Cicor Technologies and Basler Kantonalbank 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.