Correlation Between Surna and Caterpillar
Can any of the company-specific risk be diversified away by investing in both Surna and Caterpillar 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 Surna and Caterpillar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Surna Inc and Caterpillar, you can compare the effects of market volatilities on Surna and Caterpillar 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 Surna with a short position of Caterpillar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surna and Caterpillar.
Diversification Opportunities for Surna and Caterpillar
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Surna and Caterpillar is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Surna Inc and Caterpillar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caterpillar and Surna 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 Surna Inc are associated (or correlated) with Caterpillar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caterpillar has no effect on the direction of Surna i.e., Surna and Caterpillar go up and down completely randomly.
Pair Corralation between Surna and Caterpillar
If you would invest 21,543 in Caterpillar on January 20, 2024 and sell it today you would earn a total of 14,250 from holding Caterpillar or generate 66.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Surna Inc vs. Caterpillar
Performance |
| Timeline |
| Surna Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Caterpillar |
Surna and Caterpillar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surna and Caterpillar
The main advantage of trading using opposite Surna and Caterpillar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surna position performs unexpectedly, Caterpillar 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 Caterpillar will offset losses from the drop in Caterpillar's long position.| Surna vs. NH Foods Ltd | Surna vs. Premium Beverage Group | Surna vs. Timken Company | Surna vs. Inter Parfums |
| Caterpillar vs. AGCO Corporation | Caterpillar vs. CNH Industrial NV | Caterpillar vs. Deere Company | Caterpillar vs. Lindsay |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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