Correlation Between ASIA Capital and Union Auction
Can any of the company-specific risk be diversified away by investing in both ASIA Capital and Union Auction 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 ASIA Capital and Union Auction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASIA Capital Group and Union Auction Public, you can compare the effects of market volatilities on ASIA Capital and Union Auction 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 ASIA Capital with a short position of Union Auction. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASIA Capital and Union Auction.
Diversification Opportunities for ASIA Capital and Union Auction
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between ASIA and Union is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding ASIA Capital Group and Union Auction Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union Auction Public and ASIA Capital 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 ASIA Capital Group are associated (or correlated) with Union Auction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union Auction Public has no effect on the direction of ASIA Capital i.e., ASIA Capital and Union Auction go up and down completely randomly.
Pair Corralation between ASIA Capital and Union Auction
Assuming the 90 days trading horizon ASIA Capital Group is expected to under-perform the Union Auction. In addition to that, ASIA Capital is 19.2 times more volatile than Union Auction Public. It trades about -0.21 of its total potential returns per unit of risk. Union Auction Public is currently generating about -0.45 per unit of volatility. If you would invest 950.00 in Union Auction Public on August 29, 2024 and sell it today you would lose (100.00) from holding Union Auction Public or give up 10.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASIA Capital Group vs. Union Auction Public
Performance |
| Timeline |
| ASIA Capital Group |
| Union Auction Public |
ASIA Capital and Union Auction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASIA Capital and Union Auction
The main advantage of trading using opposite ASIA Capital and Union Auction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASIA Capital position performs unexpectedly, Union Auction 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 Union Auction will offset losses from the drop in Union Auction's long position.| ASIA Capital vs. Amanah Leasing Public | ASIA Capital vs. Infraset Public | ASIA Capital vs. JMT Network Services |
| Union Auction vs. AP Public | Union Auction vs. Carabao Group Public | Union Auction vs. Forth Smart Service | Union Auction vs. Com7 PCL |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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