Correlation Between Computer Sciences and MetLife
Can any of the company-specific risk be diversified away by investing in both Computer Sciences and MetLife 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 Computer Sciences and MetLife into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Computer Sciences Corp and MetLife, you can compare the effects of market volatilities on Computer Sciences and MetLife 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 Computer Sciences with a short position of MetLife. Check out your portfolio center. Please also check ongoing floating volatility patterns of Computer Sciences and MetLife.
Diversification Opportunities for Computer Sciences and MetLife
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Computer and MetLife is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Computer Sciences Corp and MetLife in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetLife and Computer Sciences 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 Computer Sciences Corp are associated (or correlated) with MetLife. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetLife has no effect on the direction of Computer Sciences i.e., Computer Sciences and MetLife go up and down completely randomly.
Pair Corralation between Computer Sciences and MetLife
If you would invest (100.00) in Computer Sciences Corp on January 20, 2024 and sell it today you would earn a total of 100.00 from holding Computer Sciences Corp 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 |
Computer Sciences Corp vs. MetLife
Performance |
| Timeline |
| Computer Sciences Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MetLife |
Computer Sciences and MetLife Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Computer Sciences and MetLife
The main advantage of trading using opposite Computer Sciences and MetLife positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Computer Sciences position performs unexpectedly, MetLife 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 MetLife will offset losses from the drop in MetLife's long position.| Computer Sciences vs. GMS Inc | Computer Sciences vs. Avarone Metals | Computer Sciences vs. Western Metals | Computer Sciences vs. Pan American Silver |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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