Correlation Between Asbury Automotive and Grupo Aeroportuario
Can any of the company-specific risk be diversified away by investing in both Asbury Automotive and Grupo Aeroportuario 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 Asbury Automotive and Grupo Aeroportuario into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asbury Automotive Group and Grupo Aeroportuario del, you can compare the effects of market volatilities on Asbury Automotive and Grupo Aeroportuario 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 Asbury Automotive with a short position of Grupo Aeroportuario. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asbury Automotive and Grupo Aeroportuario.
Diversification Opportunities for Asbury Automotive and Grupo Aeroportuario
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Asbury and Grupo is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Asbury Automotive Group and Grupo Aeroportuario del in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Aeroportuario del and Asbury Automotive 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 Asbury Automotive Group are associated (or correlated) with Grupo Aeroportuario. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Aeroportuario del has no effect on the direction of Asbury Automotive i.e., Asbury Automotive and Grupo Aeroportuario go up and down completely randomly.
Pair Corralation between Asbury Automotive and Grupo Aeroportuario
Considering the 90-day investment horizon Asbury Automotive Group is expected to generate 0.89 times more return on investment than Grupo Aeroportuario. However, Asbury Automotive Group is 1.12 times less risky than Grupo Aeroportuario. It trades about 0.04 of its potential returns per unit of risk. Grupo Aeroportuario del is currently generating about 0.03 per unit of risk. If you would invest 21,581 in Asbury Automotive Group on September 2, 2024 and sell it today you would earn a total of 4,402 from holding Asbury Automotive Group or generate 20.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asbury Automotive Group vs. Grupo Aeroportuario del
Performance |
| Timeline |
| Asbury Automotive |
| Grupo Aeroportuario del |
Asbury Automotive and Grupo Aeroportuario Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asbury Automotive and Grupo Aeroportuario
The main advantage of trading using opposite Asbury Automotive and Grupo Aeroportuario positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asbury Automotive position performs unexpectedly, Grupo Aeroportuario 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 Grupo Aeroportuario will offset losses from the drop in Grupo Aeroportuario's long position.| Asbury Automotive vs. Advance Auto Parts | Asbury Automotive vs. Tractor Supply | Asbury Automotive vs. Genuine Parts Co | Asbury Automotive vs. Five Below |
| Grupo Aeroportuario vs. Grupo Aeroportuario del | Grupo Aeroportuario vs. AerSale Corp | Grupo Aeroportuario vs. Flughafen Zrich AG | Grupo Aeroportuario vs. Grupo Aeroportuario del |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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