Correlation Between Aedas Homes and ANTA Sports
Can any of the company-specific risk be diversified away by investing in both Aedas Homes and ANTA Sports 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 Aedas Homes and ANTA Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aedas Homes SA and ANTA Sports Products, you can compare the effects of market volatilities on Aedas Homes and ANTA Sports 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 Aedas Homes with a short position of ANTA Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aedas Homes and ANTA Sports.
Diversification Opportunities for Aedas Homes and ANTA Sports
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aedas and ANTA is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Aedas Homes SA and ANTA Sports Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA Sports Products and Aedas Homes 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 Aedas Homes SA are associated (or correlated) with ANTA Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA Sports Products has no effect on the direction of Aedas Homes i.e., Aedas Homes and ANTA Sports go up and down completely randomly.
Pair Corralation between Aedas Homes and ANTA Sports
Assuming the 90 days horizon Aedas Homes SA is expected to generate 0.7 times more return on investment than ANTA Sports. However, Aedas Homes SA is 1.44 times less risky than ANTA Sports. It trades about -0.13 of its potential returns per unit of risk. ANTA Sports Products is currently generating about -0.12 per unit of risk. If you would invest 2,610 in Aedas Homes SA on August 29, 2024 and sell it today you would lose (140.00) from holding Aedas Homes SA or give up 5.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aedas Homes SA vs. ANTA Sports Products
Performance |
| Timeline |
| Aedas Homes SA |
| ANTA Sports Products |
Aedas Homes and ANTA Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aedas Homes and ANTA Sports
The main advantage of trading using opposite Aedas Homes and ANTA Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aedas Homes position performs unexpectedly, ANTA Sports 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 ANTA Sports will offset losses from the drop in ANTA Sports' long position.The idea behind Aedas Homes SA and ANTA Sports Products pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| ANTA Sports vs. Merit Medical Systems | ANTA Sports vs. Microbot Medical | ANTA Sports vs. Elmos Semiconductor SE | ANTA Sports vs. Japan Medical Dynamic |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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