Correlation Between Ieh Corp and CTS

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

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

Diversification Opportunities for Ieh Corp and CTS

0.01

Correlation Coefficient

Ieh Corp  CTS

Significant diversification

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

Pair Corralation between Ieh Corp and CTS

Given the investment horizon of 90 days Ieh Corp is expected to generate 3.15 times less return on investment than CTS. In addition to that, Ieh Corp is 2.53 times more volatile than CTS Corporation. It trades about 0.01 of its total potential returns per unit of risk. CTS Corporation is currently generating about 0.12 per unit of volatility. If you would invest  4,688  in CTS Corporation on August 31, 2024 and sell it today you would earn a total of  745.00  from holding CTS Corporation or generate 15.89% return on investment over 90 days.

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

Ieh Corp  vs.  CTS Corp.

Ieh Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ieh Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical indicators, Ieh Corp is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

CTS Corporation

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CTS Corporation are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, CTS unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ieh Corp and CTS

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

The idea behind Ieh Corp and CTS 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 CEOs Directory module to screen CEOs from public companies around the world.