Correlation Between CID HoldCo, and Red Oak

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

By analyzing existing cross correlation between CID HoldCo, Warrants and Red Oak Technology, you can compare the effects of market volatilities on CID HoldCo, and Red Oak 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 CID HoldCo, with a short position of Red Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of CID HoldCo, and Red Oak.

Diversification Opportunities for CID HoldCo, and Red Oak

0.84

Correlation Coefficient

CID HoldCo,  Red Oak

Very poor diversification

The 3 months correlation between CID and Red is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding CID HoldCo, Warrants and Red Oak Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Red Oak Technology and CID HoldCo, 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 CID HoldCo, Warrants are associated (or correlated) with Red Oak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Red Oak Technology has no effect on the direction of CID HoldCo, i.e., CID HoldCo, and Red Oak go up and down completely randomly.

Pair Corralation between CID HoldCo, and Red Oak

Assuming the 90 days horizon CID HoldCo, Warrants is expected to generate 25.61 times more return on investment than Red Oak. However, CID HoldCo, is 25.61 times more volatile than Red Oak Technology. It trades about 0.29 of its potential returns per unit of risk. Red Oak Technology is currently generating about 0.36 per unit of risk. If you would invest  2.00  in CID HoldCo, Warrants on May 4, 2025 and sell it today you would earn a total of  13.00  from holding CID HoldCo, Warrants or generate 650.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	70.97%
Values	Daily Returns

CID HoldCo, Warrants  vs.  Red Oak Technology

CID HoldCo, Warrants

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in CID HoldCo, Warrants are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting fundamental indicators, CID HoldCo, showed solid returns over the last few months and may actually be approaching a breakup point.

Red Oak Technology

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Red Oak Technology are ranked lower than 28 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Red Oak showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CID HoldCo, and Red Oak

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

The idea behind CID HoldCo, Warrants and Red Oak Technology 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.

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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.