Correlation Between Caravelle International and Codexis

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

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

Diversification Opportunities for Caravelle International and Codexis

0.07

Correlation Coefficient

Caravelle International  Codexis

Significant diversification

The 3 months correlation between Caravelle and Codexis is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Caravelle International Group and Codexis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codexis and Caravelle International 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 Caravelle International Group are associated (or correlated) with Codexis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codexis has no effect on the direction of Caravelle International i.e., Caravelle International and Codexis go up and down completely randomly.

Pair Corralation between Caravelle International and Codexis

Given the investment horizon of 90 days Caravelle International is expected to generate 1.43 times less return on investment than Codexis. In addition to that, Caravelle International is 1.46 times more volatile than Codexis. It trades about 0.03 of its total potential returns per unit of risk. Codexis is currently generating about 0.07 per unit of volatility. If you would invest  255.00  in Codexis on May 27, 2025 and sell it today you would earn a total of  34.00  from holding Codexis or generate 13.33% return on investment over 90 days.

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

Caravelle International Group  vs.  Codexis

Caravelle International

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Caravelle International Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain fundamental indicators, Caravelle International displayed solid returns over the last few months and may actually be approaching a breakup point.

Codexis

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Codexis are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Codexis unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Caravelle International and Codexis

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

The idea behind Caravelle International Group and Codexis 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.