Two Equities Correlation Analysis
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CDZI
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This model provides you with a quick lookup of cross correlation between two equities. Please specify two instruments to run the correlation.
Diversification Opportunities for Cadiz and NYSE Composite
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cadiz and NYSE is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Cadiz Inc and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Cadiz 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 Cadiz Inc are associated (or correlated) with NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Cadiz i.e., Cadiz and NYSE Composite go up and down completely randomly.
Pair Corralation between Cadiz and NYSE Composite
Given the investment horizon of 90 days Cadiz Inc is expected to generate 4.81 times more return on investment than NYSE Composite. However, Cadiz is 4.81 times more volatile than NYSE Composite. It trades about 0.03 of its potential returns per unit of risk. NYSE Composite is currently generating about 0.03 per unit of risk. If you would invest 204.00 in Cadiz Inc on January 26, 2024 and sell it today you would earn a total of 23.00 from holding Cadiz Inc or generate 11.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 99.8% |
Values | Daily Returns |
Cadiz Inc vs. NYSE Composite
Performance |
Timeline |
Cadiz and NYSE Composite Volatility Contrast
Predicted Return Density |
Returns |
Cadiz Inc
Pair trading matchups for Cadiz
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Cadiz and NYSE Composite
The main advantage of trading using opposite Cadiz and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cadiz position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite's long position.Cadiz vs. Middlesex Water | Cadiz vs. The York Water | Cadiz vs. Artesian Resources | Cadiz vs. American Water Works |
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Check out your portfolio center.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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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