Correlation Between Ares Management and GENTING SG
Can any of the company-specific risk be diversified away by investing in both Ares Management and GENTING SG 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 GENTING SG 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 GENTING SG LTD, you can compare the effects of market volatilities on Ares Management and GENTING SG 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 GENTING SG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ares Management and GENTING SG.
Diversification Opportunities for Ares Management and GENTING SG
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ares and GENTING is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ares Management Corp and GENTING SG LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENTING SG LTD 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 GENTING SG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GENTING SG LTD has no effect on the direction of Ares Management i.e., Ares Management and GENTING SG go up and down completely randomly.
Pair Corralation between Ares Management and GENTING SG
Assuming the 90 days horizon Ares Management Corp is expected to generate 0.9 times more return on investment than GENTING SG. However, Ares Management Corp is 1.11 times less risky than GENTING SG. It trades about 0.17 of its potential returns per unit of risk. GENTING SG LTD is currently generating about -0.03 per unit of risk. If you would invest 13,091 in Ares Management Corp on September 3, 2024 and sell it today you would earn a total of 3,361 from holding Ares Management Corp or generate 25.67% 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. GENTING SG LTD
Performance |
| Timeline |
| Ares Management Corp |
| GENTING SG LTD |
Ares Management and GENTING SG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ares Management and GENTING SG
The main advantage of trading using opposite Ares Management and GENTING SG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ares Management position performs unexpectedly, GENTING SG 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 GENTING SG will offset losses from the drop in GENTING SG's long position.| Ares Management vs. Blackstone Group | Ares Management vs. BlackRock | Ares Management vs. The Bank of | Ares Management vs. Ameriprise Financial |
| GENTING SG vs. Ares Management Corp | GENTING SG vs. SPORTING | GENTING SG vs. TITANIUM TRANSPORTGROUP | GENTING SG vs. EHEALTH |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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