Correlation Between Aegon NV and Dave Busters
Can any of the company-specific risk be diversified away by investing in both Aegon NV and Dave Busters 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 Dave Busters 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 Dave Busters Entertainment, you can compare the effects of market volatilities on Aegon NV and Dave Busters 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 Dave Busters. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegon NV and Dave Busters.
Diversification Opportunities for Aegon NV and Dave Busters
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aegon and Dave is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Aegon NV ADR and Dave Busters Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dave Busters Enterta 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 Dave Busters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dave Busters Enterta has no effect on the direction of Aegon NV i.e., Aegon NV and Dave Busters go up and down completely randomly.
Pair Corralation between Aegon NV and Dave Busters
Considering the 90-day investment horizon Aegon NV ADR is expected to generate 0.49 times more return on investment than Dave Busters. However, Aegon NV ADR is 2.03 times less risky than Dave Busters. It trades about 0.05 of its potential returns per unit of risk. Dave Busters Entertainment is currently generating about -0.09 per unit of risk. If you would invest 548.00 in Aegon NV ADR on August 25, 2024 and sell it today you would earn a total of 75.00 from holding Aegon NV ADR or generate 13.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegon NV ADR vs. Dave Busters Entertainment
Performance |
| Timeline |
| Aegon NV ADR |
| Dave Busters Enterta |
Aegon NV and Dave Busters Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegon NV and Dave Busters
The main advantage of trading using opposite Aegon NV and Dave Busters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegon NV position performs unexpectedly, Dave Busters 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 Dave Busters will offset losses from the drop in Dave Busters' long position.| Aegon NV vs. Hartford Financial Services | Aegon NV vs. Goosehead Insurance | Aegon NV vs. International General Insurance | Aegon NV vs. Enstar Group Limited |
| Dave Busters vs. Imax Corp | Dave Busters vs. Marcus | Dave Busters vs. AMC Networks | Dave Busters vs. Cinemark 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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