Correlation Between ABO GROUP and Caseys General
Can any of the company-specific risk be diversified away by investing in both ABO GROUP and Caseys General 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 ABO GROUP and Caseys General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABO GROUP ENVIRONMENT and Caseys General Stores, you can compare the effects of market volatilities on ABO GROUP and Caseys General 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 ABO GROUP with a short position of Caseys General. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABO GROUP and Caseys General.
Diversification Opportunities for ABO GROUP and Caseys General
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ABO and Caseys is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding ABO GROUP ENVIRONMENT and Caseys General Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caseys General Stores and ABO 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 ABO GROUP ENVIRONMENT are associated (or correlated) with Caseys General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caseys General Stores has no effect on the direction of ABO GROUP i.e., ABO GROUP and Caseys General go up and down completely randomly.
Pair Corralation between ABO GROUP and Caseys General
Assuming the 90 days trading horizon ABO GROUP ENVIRONMENT is expected to under-perform the Caseys General. But the stock apears to be less risky and, when comparing its historical volatility, ABO GROUP ENVIRONMENT is 1.23 times less risky than Caseys General. The stock trades about -0.26 of its potential returns per unit of risk. The Caseys General Stores is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 36,350 in Caseys General Stores on August 30, 2024 and sell it today you would earn a total of 3,050 from holding Caseys General Stores or generate 8.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABO GROUP ENVIRONMENT vs. Caseys General Stores
Performance |
| Timeline |
| ABO GROUP ENVIRONMENT |
| Caseys General Stores |
ABO GROUP and Caseys General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABO GROUP and Caseys General
The main advantage of trading using opposite ABO GROUP and Caseys General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABO GROUP position performs unexpectedly, Caseys General 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 Caseys General will offset losses from the drop in Caseys General's long position.The idea behind ABO GROUP ENVIRONMENT and Caseys General Stores 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.| Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple Inc |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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