Correlation Between Auswide Bank and FSA
Can any of the company-specific risk be diversified away by investing in both Auswide Bank and FSA 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 Auswide Bank and FSA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auswide Bank and FSA Group, you can compare the effects of market volatilities on Auswide Bank and FSA 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 Auswide Bank with a short position of FSA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auswide Bank and FSA.
Diversification Opportunities for Auswide Bank and FSA
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Auswide and FSA is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Auswide Bank and FSA Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FSA Group and Auswide Bank 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 Auswide Bank are associated (or correlated) with FSA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FSA Group has no effect on the direction of Auswide Bank i.e., Auswide Bank and FSA go up and down completely randomly.
Pair Corralation between Auswide Bank and FSA
Assuming the 90 days trading horizon Auswide Bank is expected to generate 1.34 times less return on investment than FSA. In addition to that, Auswide Bank is 1.68 times more volatile than FSA Group. It trades about 0.11 of its total potential returns per unit of risk. FSA Group is currently generating about 0.26 per unit of volatility. If you would invest 80.00 in FSA Group on November 4, 2024 and sell it today you would earn a total of 5.00 from holding FSA Group or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auswide Bank vs. FSA Group
Performance |
| Timeline |
| Auswide Bank |
| FSA Group |
Auswide Bank and FSA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auswide Bank and FSA
The main advantage of trading using opposite Auswide Bank and FSA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auswide Bank position performs unexpectedly, FSA 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 FSA will offset losses from the drop in FSA's long position.| Auswide Bank vs. ARN Media Limited | Auswide Bank vs. Skycity Entertainment Group | Auswide Bank vs. Lendlease Group | Auswide Bank vs. Autosports Group |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |