Correlation Between Caf Serendipity and Code Green

Can any of the company-specific risk be diversified away by investing in both Caf Serendipity and Code Green 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 Caf Serendipity and Code Green into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Caf Serendipity Holdings and Code Green Apparel, you can compare the effects of market volatilities on Caf Serendipity and Code Green 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 Caf Serendipity with a short position of Code Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caf Serendipity and Code Green.

Diversification Opportunities for Caf Serendipity and Code Green

0.1

Correlation Coefficient

Caf Serendipity  Code Green

Average diversification

The 3 months correlation between Caf and Code is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Caf Serendipity Holdings and Code Green Apparel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Code Green Apparel and Caf Serendipity 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 Caf Serendipity Holdings are associated (or correlated) with Code Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Code Green Apparel has no effect on the direction of Caf Serendipity i.e., Caf Serendipity and Code Green go up and down completely randomly.

Pair Corralation between Caf Serendipity and Code Green

Given the investment horizon of 90 days Caf Serendipity Holdings is expected to generate 8.46 times more return on investment than Code Green. However, Caf Serendipity is 8.46 times more volatile than Code Green Apparel. It trades about 0.16 of its potential returns per unit of risk. Code Green Apparel is currently generating about 0.06 per unit of risk. If you would invest  0.01  in Caf Serendipity Holdings on May 11, 2025 and sell it today you would earn a total of  0.00  from holding Caf Serendipity Holdings or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	96.88%
Values	Daily Returns

Caf Serendipity Holdings  vs.  Code Green Apparel

Caf Serendipity Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Caf Serendipity Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent technical and fundamental indicators, Caf Serendipity unveiled solid returns over the last few months and may actually be approaching a breakup point.

Code Green Apparel

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Code Green Apparel are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Code Green exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Caf Serendipity and Code Green

The main advantage of trading using opposite Caf Serendipity and Code Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caf Serendipity position performs unexpectedly, Code Green 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 Code Green will offset losses from the drop in Code Green's long position.

The idea behind Caf Serendipity Holdings and Code Green Apparel 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 the Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.