Correlation Between Asset Five and AIRA Factoring
Can any of the company-specific risk be diversified away by investing in both Asset Five and AIRA Factoring 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 Asset Five and AIRA Factoring into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asset Five Group and AIRA Factoring Public, you can compare the effects of market volatilities on Asset Five and AIRA Factoring 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 Asset Five with a short position of AIRA Factoring. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asset Five and AIRA Factoring.
Diversification Opportunities for Asset Five and AIRA Factoring
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Asset and AIRA is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Asset Five Group and AIRA Factoring Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIRA Factoring Public and Asset Five 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 Asset Five Group are associated (or correlated) with AIRA Factoring. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIRA Factoring Public has no effect on the direction of Asset Five i.e., Asset Five and AIRA Factoring go up and down completely randomly.
Pair Corralation between Asset Five and AIRA Factoring
Assuming the 90 days horizon Asset Five Group is expected to generate 13.11 times more return on investment than AIRA Factoring. However, Asset Five is 13.11 times more volatile than AIRA Factoring Public. It trades about 0.05 of its potential returns per unit of risk. AIRA Factoring Public is currently generating about -0.02 per unit of risk. If you would invest 479.00 in Asset Five Group on September 12, 2024 and sell it today you would lose (211.00) from holding Asset Five Group or give up 44.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asset Five Group vs. AIRA Factoring Public
Performance |
| Timeline |
| Asset Five Group |
| AIRA Factoring Public |
Asset Five and AIRA Factoring Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asset Five and AIRA Factoring
The main advantage of trading using opposite Asset Five and AIRA Factoring positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asset Five position performs unexpectedly, AIRA Factoring 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 AIRA Factoring will offset losses from the drop in AIRA Factoring's long position.| Asset Five vs. AIRA Factoring Public | Asset Five vs. Applied DB Public | Asset Five vs. Asia Biomass Public | Asset Five vs. ASIA Capital Group |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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