Correlation Between Concepcion Industrial and Now Corp

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

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

Diversification Opportunities for Concepcion Industrial and Now Corp

-0.21

Correlation Coefficient

Concepcion Industrial  Now Corp

Very good diversification

The 3 months correlation between Concepcion and Now is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Concepcion Industrial Corp and Now Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Now Corp and Concepcion Industrial 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 Concepcion Industrial Corp are associated (or correlated) with Now Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Now Corp has no effect on the direction of Concepcion Industrial i.e., Concepcion Industrial and Now Corp go up and down completely randomly.

Pair Corralation between Concepcion Industrial and Now Corp

Assuming the 90 days trading horizon Concepcion Industrial Corp is expected to generate 0.79 times more return on investment than Now Corp. However, Concepcion Industrial Corp is 1.27 times less risky than Now Corp. It trades about 0.14 of its potential returns per unit of risk. Now Corp is currently generating about -0.06 per unit of risk. If you would invest  1,290  in Concepcion Industrial Corp on April 20, 2025 and sell it today you would earn a total of  200.00  from holding Concepcion Industrial Corp or generate 15.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Concepcion Industrial Corp  vs.  Now Corp

Concepcion Industrial

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Concepcion Industrial Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Concepcion Industrial exhibited solid returns over the last few months and may actually be approaching a breakup point.

Now Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Now Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Concepcion Industrial and Now Corp

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

The idea behind Concepcion Industrial Corp and Now Corp 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.