Correlation Between Aeye and Comstock Holding

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

By analyzing existing cross correlation between Aeye Inc and Comstock Holding Companies, you can compare the effects of market volatilities on Aeye and Comstock Holding 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 Aeye with a short position of Comstock Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aeye and Comstock Holding.

Diversification Opportunities for Aeye and Comstock Holding

0.27

Correlation Coefficient

Aeye  Comstock Holding

Modest diversification

The 3 months correlation between Aeye and Comstock is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Aeye Inc and Comstock Holding Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Holding Com and Aeye 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 Aeye Inc are associated (or correlated) with Comstock Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Holding Com has no effect on the direction of Aeye i.e., Aeye and Comstock Holding go up and down completely randomly.

Pair Corralation between Aeye and Comstock Holding

Given the investment horizon of 90 days Aeye Inc is expected to under-perform the Comstock Holding. In addition to that, Aeye is 2.4 times more volatile than Comstock Holding Companies. It trades about -0.1 of its total potential returns per unit of risk. Comstock Holding Companies is currently generating about 0.08 per unit of volatility. If you would invest  803.00  in Comstock Holding Companies on December 28, 2024 and sell it today you would earn a total of  146.00  from holding Comstock Holding Companies or generate 18.18% return on investment over 90 days.

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

Aeye Inc  vs.  Comstock Holding Companies

Aeye Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aeye Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's fundamental indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Comstock Holding Com

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Comstock Holding Companies are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady fundamental indicators, Comstock Holding demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aeye and Comstock Holding

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

The idea behind Aeye Inc and Comstock Holding Companies 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .