Correlation Between Aegon NV and East Resources
Can any of the company-specific risk be diversified away by investing in both Aegon NV and East Resources 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 Aegon NV and East Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegon NV ADR and East Resources Acquisition, you can compare the effects of market volatilities on Aegon NV and East Resources 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 Aegon NV with a short position of East Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegon NV and East Resources.
Diversification Opportunities for Aegon NV and East Resources
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Aegon and East is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Aegon NV ADR and East Resources Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East Resources Acqui and Aegon NV 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 Aegon NV ADR are associated (or correlated) with East Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East Resources Acqui has no effect on the direction of Aegon NV i.e., Aegon NV and East Resources go up and down completely randomly.
Pair Corralation between Aegon NV and East Resources
If you would invest 569.00 in Aegon NV ADR on September 5, 2024 and sell it today you would earn a total of 72.00 from holding Aegon NV ADR or generate 12.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 1.18% |
| Values | Daily Returns |
Aegon NV ADR vs. East Resources Acquisition
Performance |
| Timeline |
| Aegon NV ADR |
| East Resources Acqui |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Aegon NV and East Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegon NV and East Resources
The main advantage of trading using opposite Aegon NV and East Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegon NV position performs unexpectedly, East Resources 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 East Resources will offset losses from the drop in East Resources' long position.| Aegon NV vs. Goosehead Insurance | Aegon NV vs. Enstar Group Limited | Aegon NV vs. American International Group | Aegon NV vs. Sun Life Financial |
| East Resources vs. Olympic Steel | East Resources vs. Aegon NV ADR | East Resources vs. Western Copper and | East Resources vs. SEI Investments |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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