Correlation Between DFDS AS and AP Mller
Can any of the company-specific risk be diversified away by investing in both DFDS AS and AP Mller 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 DFDS AS and AP Mller into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DFDS AS and AP Mller , you can compare the effects of market volatilities on DFDS AS and AP Mller 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 DFDS AS with a short position of AP Mller. Check out your portfolio center. Please also check ongoing floating volatility patterns of DFDS AS and AP Mller.
Diversification Opportunities for DFDS AS and AP Mller
Modest diversification
The 3 months correlation between DFDS and DP4B is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding DFDS AS and AP Mller in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AP Mller and DFDS AS 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 DFDS AS are associated (or correlated) with AP Mller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AP Mller has no effect on the direction of DFDS AS i.e., DFDS AS and AP Mller go up and down completely randomly.
Pair Corralation between DFDS AS and AP Mller
Assuming the 90 days horizon DFDS AS is expected to under-perform the AP Mller. In addition to that, DFDS AS is 1.48 times more volatile than AP Mller . It trades about -0.17 of its total potential returns per unit of risk. AP Mller is currently generating about -0.06 per unit of volatility. If you would invest 153,000 in AP Mller on November 1, 2024 and sell it today you would lose (14,750) from holding AP Mller or give up 9.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DFDS AS vs. AP Mller
Performance |
| Timeline |
| DFDS AS |
| AP Mller |
DFDS AS and AP Mller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DFDS AS and AP Mller
The main advantage of trading using opposite DFDS AS and AP Mller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DFDS AS position performs unexpectedly, AP Mller 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 AP Mller will offset losses from the drop in AP Mller's long position.| DFDS AS vs. Ross Stores | DFDS AS vs. WESTLAKE CHEMICAL | DFDS AS vs. Quaker Chemical | DFDS AS vs. PICKN PAY STORES |
| AP Mller vs. AP Mller | AP Mller vs. HAPAG LLOYD UNSPADR 12 | AP Mller vs. DFDS AS | AP Mller vs. Pacific Basin Shipping |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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