Correlation Between Federal Signal and CCC
Can any of the company-specific risk be diversified away by investing in both Federal Signal and CCC 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 Federal Signal and CCC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federal Signal and CCC, you can compare the effects of market volatilities on Federal Signal and CCC 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 Federal Signal with a short position of CCC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federal Signal and CCC.
Diversification Opportunities for Federal Signal and CCC
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Federal and CCC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Federal Signal and CCC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CCC and Federal Signal 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 Federal Signal are associated (or correlated) with CCC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CCC has no effect on the direction of Federal Signal i.e., Federal Signal and CCC go up and down completely randomly.
Pair Corralation between Federal Signal and CCC
If you would invest 5,234 in Federal Signal on January 24, 2024 and sell it today you would earn a total of 3,142 from holding Federal Signal or generate 60.03% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Federal Signal vs. CCC
Performance |
Timeline |
Federal Signal |
CCC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Federal Signal and CCC Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Federal Signal and CCC
The main advantage of trading using opposite Federal Signal and CCC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal Signal position performs unexpectedly, CCC 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 CCC will offset losses from the drop in CCC's long position.Federal Signal vs. Energy Recovery | Federal Signal vs. CECO Environmental Corp | Federal Signal vs. 374Water Common Stock | Federal Signal vs. CO2 Solutions |
CCC vs. Amkor Technology | CCC vs. Qorvo Inc | CCC vs. Microchip Technology | CCC vs. Definitive Healthcare Corp |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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