Correlation Between Century Communities and Matson

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

By analyzing existing cross correlation between Century Communities and Matson Inc, you can compare the effects of market volatilities on Century Communities and Matson 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 Century Communities with a short position of Matson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Communities and Matson.

Diversification Opportunities for Century Communities and Matson

-0.34

Correlation Coefficient

Century Communities  Matson

Very good diversification

The 3 months correlation between Century and Matson is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Century Communities and Matson Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matson Inc and Century Communities 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 Century Communities are associated (or correlated) with Matson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matson Inc has no effect on the direction of Century Communities i.e., Century Communities and Matson go up and down completely randomly.

Pair Corralation between Century Communities and Matson

Considering the 90-day investment horizon Century Communities is expected to generate 1.39 times more return on investment than Matson. However, Century Communities is 1.39 times more volatile than Matson Inc. It trades about 0.12 of its potential returns per unit of risk. Matson Inc is currently generating about -0.07 per unit of risk. If you would invest  5,413  in Century Communities on May 20, 2025 and sell it today you would earn a total of  1,132  from holding Century Communities or generate 20.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Century Communities  vs.  Matson Inc

Century Communities

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Century Communities are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady fundamental indicators, Century Communities unveiled solid returns over the last few months and may actually be approaching a breakup point.

Matson Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days Matson Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Century Communities and Matson

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

The idea behind Century Communities and Matson Inc 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.