Correlation Between Anheuser Busch and Accentis
Can any of the company-specific risk be diversified away by investing in both Anheuser Busch and Accentis 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 Anheuser Busch and Accentis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anheuser Busch Inbev and Accentis, you can compare the effects of market volatilities on Anheuser Busch and Accentis 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 Anheuser Busch with a short position of Accentis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anheuser Busch and Accentis.
Diversification Opportunities for Anheuser Busch and Accentis
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Anheuser and Accentis is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Anheuser Busch Inbev and Accentis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accentis and Anheuser Busch 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 Anheuser Busch Inbev are associated (or correlated) with Accentis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accentis has no effect on the direction of Anheuser Busch i.e., Anheuser Busch and Accentis go up and down completely randomly.
Pair Corralation between Anheuser Busch and Accentis
Assuming the 90 days trading horizon Anheuser Busch Inbev is expected to under-perform the Accentis. But the stock apears to be less risky and, when comparing its historical volatility, Anheuser Busch Inbev is 2.56 times less risky than Accentis. The stock trades about -0.17 of its potential returns per unit of risk. The Accentis is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 3.05 in Accentis on October 25, 2024 and sell it today you would lose (0.10) from holding Accentis or give up 3.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Anheuser Busch Inbev vs. Accentis
Performance |
| Timeline |
| Anheuser Busch Inbev |
| Accentis |
Anheuser Busch and Accentis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anheuser Busch and Accentis
The main advantage of trading using opposite Anheuser Busch and Accentis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anheuser Busch position performs unexpectedly, Accentis 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 Accentis will offset losses from the drop in Accentis' long position.| Anheuser Busch vs. ageas SANV | Anheuser Busch vs. Solvay SA | Anheuser Busch vs. KBC Groep NV | Anheuser Busch vs. Umicore SA |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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