Correlation Between Comtech Telecommunicatio and Commercial Vehicle

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

By analyzing existing cross correlation between Comtech Telecommunications Corp and Commercial Vehicle Group, you can compare the effects of market volatilities on Comtech Telecommunicatio and Commercial Vehicle 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 Comtech Telecommunicatio with a short position of Commercial Vehicle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comtech Telecommunicatio and Commercial Vehicle.

Diversification Opportunities for Comtech Telecommunicatio and Commercial Vehicle

-0.67

Correlation Coefficient

Comtech Telecommunicatio  Commercial Vehicle

Excellent diversification

The 3 months correlation between Comtech and Commercial is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Comtech Telecommunications Cor and Commercial Vehicle Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial Vehicle and Comtech Telecommunicatio 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 Comtech Telecommunications Corp are associated (or correlated) with Commercial Vehicle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial Vehicle has no effect on the direction of Comtech Telecommunicatio i.e., Comtech Telecommunicatio and Commercial Vehicle go up and down completely randomly.

Pair Corralation between Comtech Telecommunicatio and Commercial Vehicle

Given the investment horizon of 90 days Comtech Telecommunications Corp is expected to generate 1.15 times more return on investment than Commercial Vehicle. However, Comtech Telecommunicatio is 1.15 times more volatile than Commercial Vehicle Group. It trades about 0.17 of its potential returns per unit of risk. Commercial Vehicle Group is currently generating about -0.05 per unit of risk. If you would invest  222.00  in Comtech Telecommunications Corp on September 10, 2025 and sell it today you would earn a total of  107.00  from holding Comtech Telecommunications Corp or generate 48.2% return on investment over 90 days.

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

Comtech Telecommunications Cor  vs.  Commercial Vehicle Group

Comtech Telecommunicatio

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Comtech Telecommunications Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady basic indicators, Comtech Telecommunicatio disclosed solid returns over the last few months and may actually be approaching a breakup point.

Commercial Vehicle

Risk-Adjusted Performance

Weakest

Over the last 90 days Commercial Vehicle Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Comtech Telecommunicatio and Commercial Vehicle

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

The idea behind Comtech Telecommunications Corp and Commercial Vehicle Group 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.