Correlation Between Cisco Systems and Takung Art
Can any of the company-specific risk be diversified away by investing in both Cisco Systems and Takung Art 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 Cisco Systems and Takung Art into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cisco Systems and Takung Art Co, you can compare the effects of market volatilities on Cisco Systems and Takung Art 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 Cisco Systems with a short position of Takung Art. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisco Systems and Takung Art.
Diversification Opportunities for Cisco Systems and Takung Art
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cisco and Takung is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems and Takung Art Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Takung Art and Cisco Systems 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 Cisco Systems are associated (or correlated) with Takung Art. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Takung Art has no effect on the direction of Cisco Systems i.e., Cisco Systems and Takung Art go up and down completely randomly.
Pair Corralation between Cisco Systems and Takung Art
Given the investment horizon of 90 days Cisco Systems is expected to generate 0.1 times more return on investment than Takung Art. However, Cisco Systems is 10.06 times less risky than Takung Art. It trades about 0.04 of its potential returns per unit of risk. Takung Art Co is currently generating about -0.27 per unit of risk. If you would invest 5,036 in Cisco Systems on September 12, 2024 and sell it today you would earn a total of 836.00 from holding Cisco Systems or generate 16.6% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 1.14% |
Values | Daily Returns |
Cisco Systems vs. Takung Art Co
Performance |
Timeline |
Cisco Systems |
Takung Art |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Cisco Systems and Takung Art Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cisco Systems and Takung Art
The main advantage of trading using opposite Cisco Systems and Takung Art positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cisco Systems position performs unexpectedly, Takung Art 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 Takung Art will offset losses from the drop in Takung Art's long position.Cisco Systems vs. Victory Integrity Smallmid Cap | Cisco Systems vs. Hilton Worldwide Holdings | Cisco Systems vs. NVIDIA | Cisco Systems vs. JPMorgan Chase Co |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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