Correlation Between Clarus Corp and Cedar Fair

By analyzing existing cross correlation between Clarus Corp and Cedar Fair LP, you can compare the effects of market volatilities on Clarus Corp and Cedar Fair 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 Clarus Corp with a short position of Cedar Fair. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clarus Corp and Cedar Fair.

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Can any of the company-specific risk be diversified away by investing in both Clarus Corp and Cedar Fair 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 Clarus Corp and Cedar Fair into the same portfolio, which is an essential part of the fundamental portfolio management process.

Diversification Opportunities for Clarus Corp and Cedar Fair

-0.55
  Correlation Coefficient
Clarus Corp
Cedar Fair LP

Excellent diversification

The 3 months correlation between Clarus and Cedar is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Clarus Corp and Cedar Fair LP in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Cedar Fair LP and Clarus Corp 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 Clarus Corp are associated (or correlated) with Cedar Fair. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cedar Fair LP has no effect on the direction of Clarus Corp i.e., Clarus Corp and Cedar Fair go up and down completely randomly.

Pair Corralation between Clarus Corp and Cedar Fair

Given the investment horizon of 90 days Clarus Corp is expected to generate 0.64 times more return on investment than Cedar Fair. However, Clarus Corp is 1.55 times less risky than Cedar Fair. It trades about 0.07 of its potential returns per unit of risk. Cedar Fair LP is currently generating about 0.02 per unit of risk. If you would invest  1,196  in Clarus Corp on July 18, 2021 and sell it today you would earn a total of  1,577  from holding Clarus Corp or generate 131.86% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy99.6%
ValuesDaily Returns

Clarus Corp  vs.  Cedar Fair LP

 Performance (%) 
      Timeline 
Clarus Corp 
 Clarus Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Clarus Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Clarus Corp is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Clarus Price Channel

Cedar Fair LP 
 Cedar Performance
9 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Cedar Fair LP are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady basic indicators, Cedar Fair disclosed solid returns over the last few months and may actually be approaching a breakup point.

Cedar Price Channel

Clarus Corp and Cedar Fair Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Clarus Corp and Cedar Fair

The main advantage of trading using opposite Clarus Corp and Cedar Fair positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clarus Corp position performs unexpectedly, Cedar Fair 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 Cedar Fair will offset losses from the drop in Cedar Fair's long position.
The idea behind Clarus Corp and Cedar Fair LP 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.
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.

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