Correlation Between Asbury Automotive and Noco Noco
Can any of the company-specific risk be diversified away by investing in both Asbury Automotive and Noco Noco 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 Noco Noco 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 noco noco Warrant, you can compare the effects of market volatilities on Asbury Automotive and Noco Noco 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 Noco Noco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asbury Automotive and Noco Noco.
Diversification Opportunities for Asbury Automotive and Noco Noco
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Asbury and Noco is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Asbury Automotive Group and noco noco Warrant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on noco noco Warrant 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 Noco Noco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of noco noco Warrant has no effect on the direction of Asbury Automotive i.e., Asbury Automotive and Noco Noco go up and down completely randomly.
Pair Corralation between Asbury Automotive and Noco Noco
Considering the 90-day investment horizon Asbury Automotive is expected to generate 56.66 times less return on investment than Noco Noco. But when comparing it to its historical volatility, Asbury Automotive Group is 17.48 times less risky than Noco Noco. It trades about 0.05 of its potential returns per unit of risk. noco noco Warrant is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1.00 in noco noco Warrant on September 4, 2024 and sell it today you would earn a total of 0.02 from holding noco noco Warrant or generate 2.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 49.39% |
| Values | Daily Returns |
Asbury Automotive Group vs. noco noco Warrant
Performance |
| Timeline |
| Asbury Automotive |
| noco noco Warrant |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
Asbury Automotive and Noco Noco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asbury Automotive and Noco Noco
The main advantage of trading using opposite Asbury Automotive and Noco Noco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asbury Automotive position performs unexpectedly, Noco Noco 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 Noco Noco will offset losses from the drop in Noco Noco's long position.| Asbury Automotive vs. Sonic Automotive | Asbury Automotive vs. Lithia Motors | Asbury Automotive vs. AutoNation | Asbury Automotive vs. Penske Automotive 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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