Correlation Between Bet-at-home and IMPERIAL TOBACCO
Can any of the company-specific risk be diversified away by investing in both Bet-at-home and IMPERIAL TOBACCO 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 Bet-at-home and IMPERIAL TOBACCO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between bet at home AG and IMPERIAL TOBACCO , you can compare the effects of market volatilities on Bet-at-home and IMPERIAL TOBACCO 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 Bet-at-home with a short position of IMPERIAL TOBACCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bet-at-home and IMPERIAL TOBACCO.
Diversification Opportunities for Bet-at-home and IMPERIAL TOBACCO
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bet-at-home and IMPERIAL is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding bet at home AG and IMPERIAL TOBACCO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IMPERIAL TOBACCO and Bet-at-home 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 bet at home AG are associated (or correlated) with IMPERIAL TOBACCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IMPERIAL TOBACCO has no effect on the direction of Bet-at-home i.e., Bet-at-home and IMPERIAL TOBACCO go up and down completely randomly.
Pair Corralation between Bet-at-home and IMPERIAL TOBACCO
Assuming the 90 days trading horizon bet at home AG is expected to generate 4.52 times more return on investment than IMPERIAL TOBACCO. However, Bet-at-home is 4.52 times more volatile than IMPERIAL TOBACCO . It trades about 0.36 of its potential returns per unit of risk. IMPERIAL TOBACCO is currently generating about -0.06 per unit of risk. If you would invest 249.00 in bet at home AG on October 22, 2024 and sell it today you would earn a total of 48.00 from holding bet at home AG or generate 19.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
bet at home AG vs. IMPERIAL TOBACCO
Performance |
| Timeline |
| bet at home |
| IMPERIAL TOBACCO |
Bet-at-home and IMPERIAL TOBACCO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bet-at-home and IMPERIAL TOBACCO
The main advantage of trading using opposite Bet-at-home and IMPERIAL TOBACCO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bet-at-home position performs unexpectedly, IMPERIAL TOBACCO 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 IMPERIAL TOBACCO will offset losses from the drop in IMPERIAL TOBACCO's long position.| Bet-at-home vs. Direct Line Insurance | Bet-at-home vs. CDN IMPERIAL BANK | Bet-at-home vs. CHIBA BANK | Bet-at-home vs. TELECOM ITALIA |
| IMPERIAL TOBACCO vs. Corporate Travel Management | IMPERIAL TOBACCO vs. Sims Metal Management | IMPERIAL TOBACCO vs. SUN LIFE FINANCIAL | IMPERIAL TOBACCO vs. United Insurance Holdings |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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