Correlation Between ALEFARM BREWING and Greek Organization
Can any of the company-specific risk be diversified away by investing in both ALEFARM BREWING and Greek Organization 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 ALEFARM BREWING and Greek Organization into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALEFARM BREWING DK 05 and Greek Organization of, you can compare the effects of market volatilities on ALEFARM BREWING and Greek Organization 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 ALEFARM BREWING with a short position of Greek Organization. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALEFARM BREWING and Greek Organization.
Diversification Opportunities for ALEFARM BREWING and Greek Organization
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ALEFARM and Greek is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding ALEFARM BREWING DK 05 and Greek Organization of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greek Organization and ALEFARM BREWING 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 ALEFARM BREWING DK 05 are associated (or correlated) with Greek Organization. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greek Organization has no effect on the direction of ALEFARM BREWING i.e., ALEFARM BREWING and Greek Organization go up and down completely randomly.
Pair Corralation between ALEFARM BREWING and Greek Organization
Assuming the 90 days horizon ALEFARM BREWING DK 05 is expected to generate 3.27 times more return on investment than Greek Organization. However, ALEFARM BREWING is 3.27 times more volatile than Greek Organization of. It trades about 0.03 of its potential returns per unit of risk. Greek Organization of is currently generating about 0.06 per unit of risk. If you would invest 15.00 in ALEFARM BREWING DK 05 on September 13, 2024 and sell it today you would earn a total of 1.00 from holding ALEFARM BREWING DK 05 or generate 6.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
ALEFARM BREWING DK 05 vs. Greek Organization of
Performance |
Timeline |
ALEFARM BREWING DK |
Greek Organization |
ALEFARM BREWING and Greek Organization Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ALEFARM BREWING and Greek Organization
The main advantage of trading using opposite ALEFARM BREWING and Greek Organization positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALEFARM BREWING position performs unexpectedly, Greek Organization 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 Greek Organization will offset losses from the drop in Greek Organization's long position.ALEFARM BREWING vs. Corporate Travel Management | ALEFARM BREWING vs. Sumitomo Rubber Industries | ALEFARM BREWING vs. SANOK RUBBER ZY | ALEFARM BREWING vs. Jupiter Fund Management |
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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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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