Correlation Between APPLIED MATERIALS and Cairo Communication
Can any of the company-specific risk be diversified away by investing in both APPLIED MATERIALS and Cairo Communication 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 APPLIED MATERIALS and Cairo Communication into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between APPLIED MATERIALS and Cairo Communication SpA, you can compare the effects of market volatilities on APPLIED MATERIALS and Cairo Communication 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 APPLIED MATERIALS with a short position of Cairo Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of APPLIED MATERIALS and Cairo Communication.
Diversification Opportunities for APPLIED MATERIALS and Cairo Communication
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between APPLIED and Cairo is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding APPLIED MATERIALS and Cairo Communication SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cairo Communication SpA and APPLIED MATERIALS 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 APPLIED MATERIALS are associated (or correlated) with Cairo Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cairo Communication SpA has no effect on the direction of APPLIED MATERIALS i.e., APPLIED MATERIALS and Cairo Communication go up and down completely randomly.
Pair Corralation between APPLIED MATERIALS and Cairo Communication
Assuming the 90 days trading horizon APPLIED MATERIALS is expected to generate 0.97 times more return on investment than Cairo Communication. However, APPLIED MATERIALS is 1.03 times less risky than Cairo Communication. It trades about 0.07 of its potential returns per unit of risk. Cairo Communication SpA is currently generating about 0.03 per unit of risk. If you would invest 16,792 in APPLIED MATERIALS on July 14, 2025 and sell it today you would earn a total of 2,194 from holding APPLIED MATERIALS or generate 13.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
APPLIED MATERIALS vs. Cairo Communication SpA
Performance |
| Timeline |
| APPLIED MATERIALS |
| Cairo Communication SpA |
APPLIED MATERIALS and Cairo Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with APPLIED MATERIALS and Cairo Communication
The main advantage of trading using opposite APPLIED MATERIALS and Cairo Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if APPLIED MATERIALS position performs unexpectedly, Cairo Communication 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 Cairo Communication will offset losses from the drop in Cairo Communication's long position.| APPLIED MATERIALS vs. Hua Hong Semiconductor | APPLIED MATERIALS vs. The Hanover Insurance | APPLIED MATERIALS vs. REVO INSURANCE SPA | APPLIED MATERIALS vs. Japan Post Insurance |
| Cairo Communication vs. Apple Inc | Cairo Communication vs. Apple Inc | Cairo Communication vs. Apple Inc | Cairo Communication vs. Apple Inc |
Check out your portfolio center.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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| AI Portfolio Prophet Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |