Correlation Between Newbury Street and CPI Card
Can any of the company-specific risk be diversified away by investing in both Newbury Street and CPI Card 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 Newbury Street and CPI Card into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Newbury Street II and CPI Card Group, you can compare the effects of market volatilities on Newbury Street and CPI Card 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 Newbury Street with a short position of CPI Card. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newbury Street and CPI Card.
Diversification Opportunities for Newbury Street and CPI Card
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Newbury and CPI is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Newbury Street II and CPI Card Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CPI Card Group and Newbury Street 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 Newbury Street II are associated (or correlated) with CPI Card. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CPI Card Group has no effect on the direction of Newbury Street i.e., Newbury Street and CPI Card go up and down completely randomly.
Pair Corralation between Newbury Street and CPI Card
Given the investment horizon of 90 days Newbury Street is expected to generate 56.38 times less return on investment than CPI Card. But when comparing it to its historical volatility, Newbury Street II is 30.02 times less risky than CPI Card. It trades about 0.04 of its potential returns per unit of risk. CPI Card Group is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,519 in CPI Card Group on September 11, 2025 and sell it today you would earn a total of 247.00 from holding CPI Card Group or generate 16.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Newbury Street II vs. CPI Card Group
Performance |
| Timeline |
| Newbury Street II |
| CPI Card Group |
Newbury Street and CPI Card Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newbury Street and CPI Card
The main advantage of trading using opposite Newbury Street and CPI Card positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newbury Street position performs unexpectedly, CPI Card 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 CPI Card will offset losses from the drop in CPI Card's long position.| Newbury Street vs. RF Acquisition Corp | Newbury Street vs. IB Acquisition Corp | Newbury Street vs. Willow Lane Acquisition | Newbury Street vs. Cantor Equity Partners |
| CPI Card vs. Consumer Portfolio Services | CPI Card vs. Open Lending Corp | CPI Card vs. Security National Financial | CPI Card vs. Currenc Group Ordinary |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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