Correlation Analysis Between CVS Health and Alcoa

This module allows you to analyze existing cross correlation between CVS Health Corporation and Alcoa Corporation. You can compare the effects of market volatilities on CVS Health and Alcoa 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 CVS Health with a short position of Alcoa. See also your portfolio center. Please also check ongoing floating volatility patterns of CVS Health and Alcoa.
Horizon     30 Days    Login   to change
Symbolsvs
Compare Efficiency

Comparative Performance

CVS Health  
0

Risk-Adjusted Performance

Over the last 30 days CVS Health Corporation has generated negative risk-adjusted returns adding no value to investors with long positions.
Alcoa  
12

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Alcoa Corporation are ranked lower than 12 (%) of all global equities and portfolios over the last 30 days.

CVS Health and Alcoa Volatility Contrast

 Predicted Return Density 
      Returns 

CVS Health Corp.  vs.  Alcoa Corp.

 Performance (%) 
      Timeline 

Pair Volatility

Considering 30-days investment horizon, CVS Health is expected to generate 44.67 times less return on investment than Alcoa. But when comparing it to its historical volatility, CVS Health Corporation is 1.54 times less risky than Alcoa. It trades about 0.01 of its potential returns per unit of risk. Alcoa Corporation is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  2,391  in Alcoa Corporation on January 24, 2019 and sell it today you would earn a total of  626.00  from holding Alcoa Corporation or generate 26.18% return on investment over 30 days.

Pair Corralation between CVS Health and Alcoa

0.22
Time Period2 Months [change]
DirectionPositive 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Diversification Opportunities for CVS Health and Alcoa

CVS Health Corp. diversification synergy

Modest diversification

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

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