Correlation Between Acco Brands and Strong Global
Can any of the company-specific risk be diversified away by investing in both Acco Brands and Strong Global 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 Acco Brands and Strong Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acco Brands and Strong Global Entertainment,, you can compare the effects of market volatilities on Acco Brands and Strong Global 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 Acco Brands with a short position of Strong Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acco Brands and Strong Global.
Diversification Opportunities for Acco Brands and Strong Global
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Acco and Strong is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Acco Brands and Strong Global Entertainment, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strong Global Entert and Acco Brands 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 Acco Brands are associated (or correlated) with Strong Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strong Global Entert has no effect on the direction of Acco Brands i.e., Acco Brands and Strong Global go up and down completely randomly.
Pair Corralation between Acco Brands and Strong Global
Given the investment horizon of 90 days Acco Brands is expected to generate 1.45 times less return on investment than Strong Global. But when comparing it to its historical volatility, Acco Brands is 4.53 times less risky than Strong Global. It trades about 0.04 of its potential returns per unit of risk. Strong Global Entertainment, is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 333.00 in Strong Global Entertainment, on September 2, 2024 and sell it today you would lose (178.00) from holding Strong Global Entertainment, or give up 53.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 88.44% |
| Values | Daily Returns |
Acco Brands vs. Strong Global Entertainment,
Performance |
| Timeline |
| Acco Brands |
| Strong Global Entert |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
Acco Brands and Strong Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acco Brands and Strong Global
The main advantage of trading using opposite Acco Brands and Strong Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acco Brands position performs unexpectedly, Strong Global 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 Strong Global will offset losses from the drop in Strong Global's long position.| Acco Brands vs. HNI Corp | Acco Brands vs. Steelcase | Acco Brands vs. Ennis Inc | Acco Brands vs. Acacia Research |
| Strong Global vs. Catalyst Pharmaceuticals | Strong Global vs. United Rentals | Strong Global vs. Ardelyx | Strong Global vs. China Aircraft Leasing |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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