Correlation Between SOI Old and Cactus

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

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

Diversification Opportunities for SOI Old and Cactus

0.0

Correlation Coefficient

SOI Old  Cactus

Pay attention - limited upside

The 3 months correlation between SOI and Cactus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SOI Old and Cactus Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cactus Inc and SOI Old 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 SOI Old are associated (or correlated) with Cactus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cactus Inc has no effect on the direction of SOI Old i.e., SOI Old and Cactus go up and down completely randomly.

Pair Corralation between SOI Old and Cactus

If you would invest (100.00) in SOI Old on November 28, 2024 and sell it today you would earn a total of  100.00  from holding SOI Old or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

SOI Old  vs.  Cactus Inc

SOI Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days SOI Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, SOI Old is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Cactus Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cactus Inc 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 indicators remain rather sound which may send shares a bit higher in March 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with SOI Old and Cactus

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

The idea behind SOI Old and Cactus Inc 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.