Correlation Between Corporate Travel and ALEFARM BREWING
Can any of the company-specific risk be diversified away by investing in both Corporate Travel and ALEFARM BREWING 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 Corporate Travel and ALEFARM BREWING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corporate Travel Management and ALEFARM BREWING DK 05, you can compare the effects of market volatilities on Corporate Travel and ALEFARM BREWING 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 Corporate Travel with a short position of ALEFARM BREWING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corporate Travel and ALEFARM BREWING.
Diversification Opportunities for Corporate Travel and ALEFARM BREWING
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Corporate and ALEFARM is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Corporate Travel Management and ALEFARM BREWING DK 05 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALEFARM BREWING DK and Corporate Travel 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 Corporate Travel Management are associated (or correlated) with ALEFARM BREWING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALEFARM BREWING DK has no effect on the direction of Corporate Travel i.e., Corporate Travel and ALEFARM BREWING go up and down completely randomly.
Pair Corralation between Corporate Travel and ALEFARM BREWING
Assuming the 90 days trading horizon Corporate Travel Management is expected to generate 0.44 times more return on investment than ALEFARM BREWING. However, Corporate Travel Management is 2.29 times less risky than ALEFARM BREWING. It trades about 0.11 of its potential returns per unit of risk. ALEFARM BREWING DK 05 is currently generating about -0.25 per unit of risk. If you would invest 775.00 in Corporate Travel Management on September 14, 2024 and sell it today you would earn a total of 30.00 from holding Corporate Travel Management or generate 3.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Corporate Travel Management vs. ALEFARM BREWING DK 05
Performance |
| Timeline |
| Corporate Travel Man |
| ALEFARM BREWING DK |
Corporate Travel and ALEFARM BREWING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Corporate Travel and ALEFARM BREWING
The main advantage of trading using opposite Corporate Travel and ALEFARM BREWING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corporate Travel position performs unexpectedly, ALEFARM BREWING 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 ALEFARM BREWING will offset losses from the drop in ALEFARM BREWING's long position.| Corporate Travel vs. Apple Inc | Corporate Travel vs. Apple Inc | Corporate Travel vs. Apple Inc | Corporate Travel vs. Apple Inc |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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