Correlation Between CompX International and Criteo Sa

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

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

Diversification Opportunities for CompX International and Criteo Sa

0.01

Correlation Coefficient

CompX International  Criteo Sa

Significant diversification

The 3 months correlation between CompX and Criteo is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding CompX International and Criteo Sa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Criteo Sa and CompX International 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 CompX International are associated (or correlated) with Criteo Sa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Criteo Sa has no effect on the direction of CompX International i.e., CompX International and Criteo Sa go up and down completely randomly.

Pair Corralation between CompX International and Criteo Sa

Considering the 90-day investment horizon CompX International is expected to under-perform the Criteo Sa. In addition to that, CompX International is 3.9 times more volatile than Criteo Sa. It trades about -0.02 of its total potential returns per unit of risk. Criteo Sa is currently generating about -0.03 per unit of volatility. If you would invest  4,193  in Criteo Sa on October 5, 2024 and sell it today you would lose (63.00) from holding Criteo Sa or give up 1.5% of portfolio value over 90 days.

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

CompX International  vs.  Criteo Sa

CompX International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CompX International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong forward indicators, CompX International is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Criteo Sa

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Criteo Sa are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Criteo Sa may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with CompX International and Criteo Sa

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

The idea behind CompX International and Criteo Sa 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.