Correlation Between Asbury Automotive and Summit Environmental
Can any of the company-specific risk be diversified away by investing in both Asbury Automotive and Summit Environmental 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 Summit Environmental 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 Summit Environmental, you can compare the effects of market volatilities on Asbury Automotive and Summit Environmental 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 Summit Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asbury Automotive and Summit Environmental.
Diversification Opportunities for Asbury Automotive and Summit Environmental
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Asbury and Summit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Asbury Automotive Group and Summit Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summit Environmental 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 Summit Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summit Environmental has no effect on the direction of Asbury Automotive i.e., Asbury Automotive and Summit Environmental go up and down completely randomly.
Pair Corralation between Asbury Automotive and Summit Environmental
If you would invest 22,977 in Asbury Automotive Group on August 24, 2024 and sell it today you would earn a total of 2,839 from holding Asbury Automotive Group or generate 12.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Asbury Automotive Group vs. Summit Environmental
Performance |
| Timeline |
| Asbury Automotive |
| Summit Environmental |
Asbury Automotive and Summit Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asbury Automotive and Summit Environmental
The main advantage of trading using opposite Asbury Automotive and Summit Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asbury Automotive position performs unexpectedly, Summit Environmental 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 Summit Environmental will offset losses from the drop in Summit Environmental's long position.| Asbury Automotive vs. Group 1 Automotive | Asbury Automotive vs. Lithia Motors | Asbury Automotive vs. AutoNation | Asbury Automotive vs. Sonic Automotive |
| Summit Environmental vs. Ascendant Resources | Summit Environmental vs. Cantex Mine Development | Summit Environmental vs. Amarc Resources | Summit Environmental vs. Sterling Metals Corp |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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