Correlation Between Corning Incorporated and Cps Technologies

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

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

Diversification Opportunities for Corning Incorporated and Cps Technologies

0.66

Correlation Coefficient

Corning Incorporated  Cps Technologies

Poor diversification

The 3 months correlation between Corning and Cps is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Corning Incorporated and Cps Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cps Technologies and Corning Incorporated 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 Corning Incorporated are associated (or correlated) with Cps Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cps Technologies has no effect on the direction of Corning Incorporated i.e., Corning Incorporated and Cps Technologies go up and down completely randomly.

Pair Corralation between Corning Incorporated and Cps Technologies

Considering the 90-day investment horizon Corning Incorporated is expected to generate 12.78 times less return on investment than Cps Technologies. But when comparing it to its historical volatility, Corning Incorporated is 1.81 times less risky than Cps Technologies. It trades about 0.0 of its potential returns per unit of risk. Cps Technologies is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  162.00  in Cps Technologies on December 27, 2024 and sell it today you would earn a total of  6.00  from holding Cps Technologies or generate 3.7% return on investment over 90 days.

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

Corning Incorporated  vs.  Cps Technologies

Corning Incorporated

Risk-Adjusted Performance

Very Weak

Over the last 90 days Corning Incorporated has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable essential indicators, Corning Incorporated is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Cps Technologies

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cps Technologies are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Cps Technologies may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Corning Incorporated and Cps Technologies

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

The idea behind Corning Incorporated and Cps Technologies 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.