Correlation Between Tortoise Capital and Cahxx

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

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

Diversification Opportunities for Tortoise Capital and Cahxx

-0.76

Correlation Coefficient

Tortoise Capital  Cahxx

Pay attention - limited upside

The 3 months correlation between Tortoise and Cahxx is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Tortoise Capital Series and Cahxx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cahxx and Tortoise Capital 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 Tortoise Capital Series are associated (or correlated) with Cahxx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cahxx has no effect on the direction of Tortoise Capital i.e., Tortoise Capital and Cahxx go up and down completely randomly.

Pair Corralation between Tortoise Capital and Cahxx

Considering the 90-day investment horizon Tortoise Capital is expected to generate 30.18 times less return on investment than Cahxx. But when comparing it to its historical volatility, Tortoise Capital Series is 51.13 times less risky than Cahxx. It trades about 0.18 of its potential returns per unit of risk. Cahxx is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  521.00  in Cahxx on September 30, 2024 and sell it today you would lose (421.00) from holding Cahxx or give up 80.81% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Tortoise Capital Series  vs.  Cahxx

Tortoise Capital Series

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Tortoise Capital Series are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly fragile basic indicators, Tortoise Capital may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Cahxx

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cahxx are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Cahxx showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Tortoise Capital and Cahxx

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

The idea behind Tortoise Capital Series and Cahxx 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.