Correlation Between Ares Management and SOGECLAIR
Can any of the company-specific risk be diversified away by investing in both Ares Management and SOGECLAIR 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 Ares Management and SOGECLAIR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ares Management Corp and SOGECLAIR SA INH, you can compare the effects of market volatilities on Ares Management and SOGECLAIR 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 Ares Management with a short position of SOGECLAIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ares Management and SOGECLAIR.
Diversification Opportunities for Ares Management and SOGECLAIR
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ares and SOGECLAIR is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Ares Management Corp and SOGECLAIR SA INH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOGECLAIR SA INH and Ares Management 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 Ares Management Corp are associated (or correlated) with SOGECLAIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOGECLAIR SA INH has no effect on the direction of Ares Management i.e., Ares Management and SOGECLAIR go up and down completely randomly.
Pair Corralation between Ares Management and SOGECLAIR
Assuming the 90 days horizon Ares Management Corp is expected to generate 1.08 times more return on investment than SOGECLAIR. However, Ares Management is 1.08 times more volatile than SOGECLAIR SA INH. It trades about 0.11 of its potential returns per unit of risk. SOGECLAIR SA INH is currently generating about -0.01 per unit of risk. If you would invest 13,937 in Ares Management Corp on September 22, 2024 and sell it today you would earn a total of 2,249 from holding Ares Management Corp or generate 16.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ares Management Corp vs. SOGECLAIR SA INH
Performance |
| Timeline |
| Ares Management Corp |
| SOGECLAIR SA INH |
Ares Management and SOGECLAIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ares Management and SOGECLAIR
The main advantage of trading using opposite Ares Management and SOGECLAIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ares Management position performs unexpectedly, SOGECLAIR 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 SOGECLAIR will offset losses from the drop in SOGECLAIR's long position.| Ares Management vs. Ameriprise Financial | Ares Management vs. Superior Plus Corp | Ares Management vs. SIVERS SEMICONDUCTORS AB | Ares Management vs. CHINA HUARONG ENERHD 50 |
| SOGECLAIR vs. Superior Plus Corp | SOGECLAIR vs. Origin Agritech | SOGECLAIR vs. INTUITIVE SURGICAL | SOGECLAIR vs. Intel |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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