Correlation Between Asseco Business and Clean Carbon
Can any of the company-specific risk be diversified away by investing in both Asseco Business and Clean Carbon 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 Asseco Business and Clean Carbon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asseco Business Solutions and Clean Carbon Energy, you can compare the effects of market volatilities on Asseco Business and Clean Carbon 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 Asseco Business with a short position of Clean Carbon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asseco Business and Clean Carbon.
Diversification Opportunities for Asseco Business and Clean Carbon
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Asseco and Clean is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Asseco Business Solutions and Clean Carbon Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clean Carbon Energy and Asseco Business 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 Asseco Business Solutions are associated (or correlated) with Clean Carbon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clean Carbon Energy has no effect on the direction of Asseco Business i.e., Asseco Business and Clean Carbon go up and down completely randomly.
Pair Corralation between Asseco Business and Clean Carbon
Assuming the 90 days trading horizon Asseco Business Solutions is expected to under-perform the Clean Carbon. But the stock apears to be less risky and, when comparing its historical volatility, Asseco Business Solutions is 3.31 times less risky than Clean Carbon. The stock trades about -0.07 of its potential returns per unit of risk. The Clean Carbon Energy is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 33.00 in Clean Carbon Energy on August 26, 2024 and sell it today you would lose (2.00) from holding Clean Carbon Energy or give up 6.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asseco Business Solutions vs. Clean Carbon Energy
Performance |
| Timeline |
| Asseco Business Solutions |
| Clean Carbon Energy |
Asseco Business and Clean Carbon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asseco Business and Clean Carbon
The main advantage of trading using opposite Asseco Business and Clean Carbon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asseco Business position performs unexpectedly, Clean Carbon 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 Clean Carbon will offset losses from the drop in Clean Carbon's long position.| Asseco Business vs. Immobile | Asseco Business vs. UniCredit SpA | Asseco Business vs. Mlk Foods Public | Asseco Business vs. Movie Games SA |
| Clean Carbon vs. Lubelski Wegiel Bogdanka | Clean Carbon vs. Asseco Business Solutions | Clean Carbon vs. Detalion Games SA | Clean Carbon vs. Asseco South Eastern |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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