Correlation Between SoftBank Group and Impax Asset
Can any of the company-specific risk be diversified away by investing in both SoftBank Group and Impax Asset 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 SoftBank Group and Impax Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SoftBank Group Corp and Impax Asset Management, you can compare the effects of market volatilities on SoftBank Group and Impax Asset 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 SoftBank Group with a short position of Impax Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of SoftBank Group and Impax Asset.
Diversification Opportunities for SoftBank Group and Impax Asset
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SoftBank and Impax is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding SoftBank Group Corp and Impax Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impax Asset Management and SoftBank Group 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 SoftBank Group Corp are associated (or correlated) with Impax Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impax Asset Management has no effect on the direction of SoftBank Group i.e., SoftBank Group and Impax Asset go up and down completely randomly.
Pair Corralation between SoftBank Group and Impax Asset
Assuming the 90 days trading horizon SoftBank Group Corp is expected to generate 0.98 times more return on investment than Impax Asset. However, SoftBank Group Corp is 1.02 times less risky than Impax Asset. It trades about 0.05 of its potential returns per unit of risk. Impax Asset Management is currently generating about -0.04 per unit of risk. If you would invest 615,625 in SoftBank Group Corp on September 3, 2024 and sell it today you would earn a total of 262,375 from holding SoftBank Group Corp or generate 42.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.73% |
| Values | Daily Returns |
SoftBank Group Corp vs. Impax Asset Management
Performance |
| Timeline |
| SoftBank Group Corp |
| Impax Asset Management |
SoftBank Group and Impax Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SoftBank Group and Impax Asset
The main advantage of trading using opposite SoftBank Group and Impax Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SoftBank Group position performs unexpectedly, Impax Asset 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 Impax Asset will offset losses from the drop in Impax Asset's long position.| SoftBank Group vs. Home Depot | SoftBank Group vs. Beazer Homes USA | SoftBank Group vs. Ecclesiastical Insurance Office | SoftBank Group vs. Systemair AB |
| Impax Asset vs. Seche Environnement SA | Impax Asset vs. Veolia Environnement VE | Impax Asset vs. Check Point Software | Impax Asset vs. AIM ImmunoTech |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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