Correlation Between Eagle Materials and Color Star
Can any of the company-specific risk be diversified away by investing in both Eagle Materials and Color Star 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 Eagle Materials and Color Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Materials and Color Star Technology, you can compare the effects of market volatilities on Eagle Materials and Color Star 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 Eagle Materials with a short position of Color Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Materials and Color Star.
Diversification Opportunities for Eagle Materials and Color Star
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eagle and Color is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Materials and Color Star Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Color Star Technology and Eagle Materials 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 Eagle Materials are associated (or correlated) with Color Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Color Star Technology has no effect on the direction of Eagle Materials i.e., Eagle Materials and Color Star go up and down completely randomly.
Pair Corralation between Eagle Materials and Color Star
If you would invest 0.00 in Color Star Technology on January 25, 2024 and sell it today you would earn a total of 0.00 from holding Color Star Technology or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 4.55% |
Values | Daily Returns |
Eagle Materials vs. Color Star Technology
Performance |
Timeline |
Eagle Materials |
Color Star Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Eagle Materials and Color Star Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eagle Materials and Color Star
The main advantage of trading using opposite Eagle Materials and Color Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Materials position performs unexpectedly, Color Star 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 Color Star will offset losses from the drop in Color Star's long position.Eagle Materials vs. United States Lime | Eagle Materials vs. Holcim | Eagle Materials vs. Lafargeholcim Ltd ADR | Eagle Materials vs. Cementos Pacasmayo SAA |
Color Star vs. United Utilities Group | Color Star vs. NiSource | Color Star vs. Suburban Propane Partners | Color Star vs. Cedar Fair LP |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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