Correlation Between Cshg Logistica and VF

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

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

Diversification Opportunities for Cshg Logistica and VF

-0.22

Correlation Coefficient

Cshg Logistica  VF

Very good diversification

The 3 months correlation between Cshg and VF is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Cshg Logistica and VF Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VF Corporation and Cshg Logistica 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 Cshg Logistica are associated (or correlated) with VF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VF Corporation has no effect on the direction of Cshg Logistica i.e., Cshg Logistica and VF go up and down completely randomly.

Pair Corralation between Cshg Logistica and VF

Assuming the 90 days trading horizon Cshg Logistica is expected to under-perform the VF. But the fund apears to be less risky and, when comparing its historical volatility, Cshg Logistica is 2.51 times less risky than VF. The fund trades about -0.22 of its potential returns per unit of risk. The VF Corporation is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  6,730  in VF Corporation on October 23, 2024 and sell it today you would earn a total of  459.00  from holding VF Corporation or generate 6.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	94.44%
Values	Daily Returns

Cshg Logistica   vs.  VF Corp.

Cshg Logistica

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cshg Logistica has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong essential indicators, Cshg Logistica is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

VF Corporation

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in VF Corporation are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental indicators, VF sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cshg Logistica and VF

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

The idea behind Cshg Logistica and VF Corporation 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.