Correlation Between Vulcan Materials and Axfood AB
Can any of the company-specific risk be diversified away by investing in both Vulcan Materials and Axfood AB 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 Vulcan Materials and Axfood AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vulcan Materials Co and Axfood AB, you can compare the effects of market volatilities on Vulcan Materials and Axfood AB 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 Vulcan Materials with a short position of Axfood AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vulcan Materials and Axfood AB.
Diversification Opportunities for Vulcan Materials and Axfood AB
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Vulcan and Axfood is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Vulcan Materials Co and Axfood AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axfood AB and Vulcan 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 Vulcan Materials Co are associated (or correlated) with Axfood AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axfood AB has no effect on the direction of Vulcan Materials i.e., Vulcan Materials and Axfood AB go up and down completely randomly.
Pair Corralation between Vulcan Materials and Axfood AB
Assuming the 90 days trading horizon Vulcan Materials Co is expected to generate 1.22 times more return on investment than Axfood AB. However, Vulcan Materials is 1.22 times more volatile than Axfood AB. It trades about 0.02 of its potential returns per unit of risk. Axfood AB is currently generating about -0.08 per unit of risk. If you would invest 26,527 in Vulcan Materials Co on November 7, 2024 and sell it today you would earn a total of 675.00 from holding Vulcan Materials Co or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.05% |
| Values | Daily Returns |
Vulcan Materials Co vs. Axfood AB
Performance |
| Timeline |
| Vulcan Materials |
| Axfood AB |
Vulcan Materials and Axfood AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vulcan Materials and Axfood AB
The main advantage of trading using opposite Vulcan Materials and Axfood AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vulcan Materials position performs unexpectedly, Axfood AB 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 Axfood AB will offset losses from the drop in Axfood AB's long position.| Vulcan Materials vs. Dalata Hotel Group | Vulcan Materials vs. Prosiebensat 1 Media | Vulcan Materials vs. United Utilities Group | Vulcan Materials vs. GoldMining |
| Axfood AB vs. Anglo Asian Mining | Axfood AB vs. Coeur Mining | Axfood AB vs. Scandic Hotels Group | Axfood AB vs. McEwen Mining |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |