Correlation Between Hexcel and Cubic
Can any of the company-specific risk be diversified away by investing in both Hexcel and Cubic 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 Hexcel and Cubic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hexcel and Cubic, you can compare the effects of market volatilities on Hexcel and Cubic 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 Hexcel with a short position of Cubic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hexcel and Cubic.
Diversification Opportunities for Hexcel and Cubic
Pay attention - limited upside
The 3 months correlation between Hexcel and Cubic is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Hexcel and Cubic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cubic and Hexcel 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 Hexcel are associated (or correlated) with Cubic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cubic has no effect on the direction of Hexcel i.e., Hexcel and Cubic go up and down completely randomly.
Pair Corralation between Hexcel and Cubic
If you would invest (100.00) in Cubic on January 25, 2024 and sell it today you would earn a total of 100.00 from holding Cubic 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 |
Hexcel vs. Cubic
Performance |
| Timeline |
| Hexcel |
| Cubic |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Hexcel and Cubic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hexcel and Cubic
The main advantage of trading using opposite Hexcel and Cubic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hexcel position performs unexpectedly, Cubic 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 Cubic will offset losses from the drop in Cubic's long position.The idea behind Hexcel and Cubic 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.| Cubic vs. Stepan Company | Cubic vs. Sensient Technologies | Cubic vs. The Mosaic | Cubic vs. Hudson Technologies |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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