Correlation Between CPI Computer and Thrace Plastics

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

By analyzing existing cross correlation between CPI Computer Peripherals and Thrace Plastics Holding, you can compare the effects of market volatilities on CPI Computer and Thrace Plastics 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 CPI Computer with a short position of Thrace Plastics. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPI Computer and Thrace Plastics.

Diversification Opportunities for CPI Computer and Thrace Plastics

-0.09

Correlation Coefficient

CPI Computer  Thrace Plastics

Good diversification

The 3 months correlation between CPI and Thrace is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding CPI Computer Peripherals and Thrace Plastics Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thrace Plastics Holding and CPI Computer 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 CPI Computer Peripherals are associated (or correlated) with Thrace Plastics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thrace Plastics Holding has no effect on the direction of CPI Computer i.e., CPI Computer and Thrace Plastics go up and down completely randomly.

Pair Corralation between CPI Computer and Thrace Plastics

Assuming the 90 days trading horizon CPI Computer Peripherals is expected to generate 2.29 times more return on investment than Thrace Plastics. However, CPI Computer is 2.29 times more volatile than Thrace Plastics Holding. It trades about 0.06 of its potential returns per unit of risk. Thrace Plastics Holding is currently generating about 0.05 per unit of risk. If you would invest  55.00  in CPI Computer Peripherals on April 22, 2025 and sell it today you would earn a total of  6.00  from holding CPI Computer Peripherals or generate 10.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

CPI Computer Peripherals  vs.  Thrace Plastics Holding

CPI Computer Peripherals

Risk-Adjusted Performance

Modest

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

Thrace Plastics Holding

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Thrace Plastics Holding are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Thrace Plastics is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with CPI Computer and Thrace Plastics

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

The idea behind CPI Computer Peripherals and Thrace Plastics Holding 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.