Correlation Between Cable One and Deluxe
Can any of the company-specific risk be diversified away by investing in both Cable One and Deluxe 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 Cable One and Deluxe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cable One and Deluxe, you can compare the effects of market volatilities on Cable One and Deluxe 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 Cable One with a short position of Deluxe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cable One and Deluxe.
Diversification Opportunities for Cable One and Deluxe
Very good diversification
The 3 months correlation between Cable and Deluxe is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Cable One and Deluxe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deluxe and Cable One 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 Cable One are associated (or correlated) with Deluxe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deluxe has no effect on the direction of Cable One i.e., Cable One and Deluxe go up and down completely randomly.
Pair Corralation between Cable One and Deluxe
Given the investment horizon of 90 days Cable One is expected to under-perform the Deluxe. But the stock apears to be less risky and, when comparing its historical volatility, Cable One is 1.07 times less risky than Deluxe. The stock trades about -0.66 of its potential returns per unit of risk. The Deluxe is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,847 in Deluxe on August 22, 2025 and sell it today you would earn a total of 16.00 from holding Deluxe or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cable One vs. Deluxe
Performance |
| Timeline |
| Cable One |
| Deluxe |
Cable One and Deluxe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cable One and Deluxe
The main advantage of trading using opposite Cable One and Deluxe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cable One position performs unexpectedly, Deluxe 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 Deluxe will offset losses from the drop in Deluxe's long position.| Cable One vs. Altice USA | Cable One vs. Sify Technologies Limited | Cable One vs. Shenandoah Telecommunications Co | Cable One vs. Shutterstock |
| Deluxe vs. Emerald Expositions Events | Deluxe vs. Shutterstock | Deluxe vs. QuinStreet | Deluxe vs. Clear Channel Outdoor |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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