Correlation Between ACS Actividades and HOCHTIEF Aktiengesellscha
Can any of the company-specific risk be diversified away by investing in both ACS Actividades and HOCHTIEF Aktiengesellscha 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 ACS Actividades and HOCHTIEF Aktiengesellscha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ACS Actividades de and HOCHTIEF Aktiengesellschaft, you can compare the effects of market volatilities on ACS Actividades and HOCHTIEF Aktiengesellscha 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 ACS Actividades with a short position of HOCHTIEF Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACS Actividades and HOCHTIEF Aktiengesellscha.
Diversification Opportunities for ACS Actividades and HOCHTIEF Aktiengesellscha
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between ACS and HOCHTIEF is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding ACS Actividades de and HOCHTIEF Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HOCHTIEF Aktiengesellscha and ACS Actividades 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 ACS Actividades de are associated (or correlated) with HOCHTIEF Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HOCHTIEF Aktiengesellscha has no effect on the direction of ACS Actividades i.e., ACS Actividades and HOCHTIEF Aktiengesellscha go up and down completely randomly.
Pair Corralation between ACS Actividades and HOCHTIEF Aktiengesellscha
Assuming the 90 days horizon ACS Actividades de is expected to generate 0.13 times more return on investment than HOCHTIEF Aktiengesellscha. However, ACS Actividades de is 7.75 times less risky than HOCHTIEF Aktiengesellscha. It trades about 0.22 of its potential returns per unit of risk. HOCHTIEF Aktiengesellschaft is currently generating about 0.02 per unit of risk. If you would invest 4,500 in ACS Actividades de on September 3, 2024 and sell it today you would earn a total of 33.00 from holding ACS Actividades de or generate 0.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ACS Actividades de vs. HOCHTIEF Aktiengesellschaft
Performance |
| Timeline |
| ACS Actividades de |
| HOCHTIEF Aktiengesellscha |
ACS Actividades and HOCHTIEF Aktiengesellscha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ACS Actividades and HOCHTIEF Aktiengesellscha
The main advantage of trading using opposite ACS Actividades and HOCHTIEF Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACS Actividades position performs unexpectedly, HOCHTIEF Aktiengesellscha 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 HOCHTIEF Aktiengesellscha will offset losses from the drop in HOCHTIEF Aktiengesellscha's long position.| ACS Actividades vs. Acciona SA | ACS Actividades vs. JGC Corp | ACS Actividades vs. Kajima Corp ADR | ACS Actividades vs. ACS Actividades De |
| HOCHTIEF Aktiengesellscha vs. ACS Actividades de | HOCHTIEF Aktiengesellscha vs. ACS Actividades De | HOCHTIEF Aktiengesellscha vs. Arcadis NV |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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