Correlation Between Caravelle International and Precision Optics,

Can any of the company-specific risk be diversified away by investing in both Caravelle International and Precision Optics, 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 Precision Optics, 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 Precision Optics,, you can compare the effects of market volatilities on Caravelle International and Precision Optics, 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 Precision Optics,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caravelle International and Precision Optics,.

Diversification Opportunities for Caravelle International and Precision Optics,

-0.2

Correlation Coefficient

Caravelle International  Precision Optics,

Good diversification

The 3 months correlation between Caravelle and Precision is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Caravelle International Group and Precision Optics, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Precision Optics, 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 Precision Optics,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Precision Optics, has no effect on the direction of Caravelle International i.e., Caravelle International and Precision Optics, go up and down completely randomly.

Pair Corralation between Caravelle International and Precision Optics,

Given the investment horizon of 90 days Caravelle International Group is expected to under-perform the Precision Optics,. In addition to that, Caravelle International is 2.31 times more volatile than Precision Optics,. It trades about -0.04 of its total potential returns per unit of risk. Precision Optics, is currently generating about 0.05 per unit of volatility. If you would invest  437.00  in Precision Optics, on May 20, 2025 and sell it today you would earn a total of  30.00  from holding Precision Optics, or generate 6.86% return on investment over 90 days.

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

Caravelle International Group  vs.  Precision Optics,

Caravelle International

Risk-Adjusted Performance

Weakest

Over the last 90 days Caravelle International Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in September 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Precision Optics,

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Precision Optics, are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady fundamental indicators, Precision Optics, may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Caravelle International and Precision Optics,

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

The idea behind Caravelle International Group and Precision Optics, 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.