Correlation Between International Consolidated and Zencash Investment

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

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

Diversification Opportunities for International Consolidated and Zencash Investment

-0.02

Correlation Coefficient

International Consolidated  Zencash Investment

Good diversification

The 3 months correlation between International and Zencash is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding International Consolidated Com and Zencash Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zencash Investment Trust and International Consolidated 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 International Consolidated Companies are associated (or correlated) with Zencash Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zencash Investment Trust has no effect on the direction of International Consolidated i.e., International Consolidated and Zencash Investment go up and down completely randomly.

Pair Corralation between International Consolidated and Zencash Investment

Given the investment horizon of 90 days International Consolidated Companies is expected to generate 7.41 times more return on investment than Zencash Investment. However, International Consolidated is 7.41 times more volatile than Zencash Investment Trust. It trades about 0.17 of its potential returns per unit of risk. Zencash Investment Trust is currently generating about -0.2 per unit of risk. If you would invest  3.00  in International Consolidated Companies on December 22, 2024 and sell it today you would earn a total of  0.00  from holding International Consolidated Companies or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

International Consolidated Com  vs.  Zencash Investment Trust

International Consolidated

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in International Consolidated Companies are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental indicators, International Consolidated exhibited solid returns over the last few months and may actually be approaching a breakup point.

Zencash Investment Trust

Risk-Adjusted Performance

Very Weak

Over the last 90 days Zencash Investment Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with International Consolidated and Zencash Investment

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

The idea behind International Consolidated Companies and Zencash Investment Trust 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..