Correlation Between Rockwell Collins and CAE
Can any of the company-specific risk be diversified away by investing in both Rockwell Collins and CAE 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 Rockwell Collins and CAE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rockwell Collins and CAE Inc, you can compare the effects of market volatilities on Rockwell Collins and CAE 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 Rockwell Collins with a short position of CAE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rockwell Collins and CAE.
Diversification Opportunities for Rockwell Collins and CAE
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Rockwell and CAE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Rockwell Collins and CAE Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAE Inc and Rockwell Collins 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 Rockwell Collins are associated (or correlated) with CAE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAE Inc has no effect on the direction of Rockwell Collins i.e., Rockwell Collins and CAE go up and down completely randomly.
Pair Corralation between Rockwell Collins and CAE
If you would invest (100.00) in Rockwell Collins on February 24, 2024 and sell it today you would earn a total of 100.00 from holding Rockwell Collins 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 |
Rockwell Collins vs. CAE Inc
Performance |
Timeline |
Rockwell Collins |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
CAE Inc |
Rockwell Collins and CAE Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Rockwell Collins and CAE
The main advantage of trading using opposite Rockwell Collins and CAE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rockwell Collins position performs unexpectedly, CAE 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 CAE will offset losses from the drop in CAE's long position.Rockwell Collins vs. Duckhorn Portfolio | Rockwell Collins vs. Compania Cervecerias Unidas | Rockwell Collins vs. Diageo PLC ADR | Rockwell Collins vs. HNI 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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