Correlation Between Koninklijke Ahold and EAGLE MATERIALS
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By analyzing existing cross correlation between Koninklijke Ahold Delhaize and EAGLE MATERIALS, you can compare the effects of market volatilities on Koninklijke Ahold and EAGLE MATERIALS 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 Koninklijke Ahold with a short position of EAGLE MATERIALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koninklijke Ahold and EAGLE MATERIALS.
Diversification Opportunities for Koninklijke Ahold and EAGLE MATERIALS
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Koninklijke and EAGLE is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Koninklijke Ahold Delhaize and EAGLE MATERIALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EAGLE MATERIALS and Koninklijke Ahold 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 Koninklijke Ahold Delhaize are associated (or correlated) with EAGLE MATERIALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EAGLE MATERIALS has no effect on the direction of Koninklijke Ahold i.e., Koninklijke Ahold and EAGLE MATERIALS go up and down completely randomly.
Pair Corralation between Koninklijke Ahold and EAGLE MATERIALS
Assuming the 90 days trading horizon Koninklijke Ahold Delhaize is expected to generate 0.54 times more return on investment than EAGLE MATERIALS. However, Koninklijke Ahold Delhaize is 1.86 times less risky than EAGLE MATERIALS. It trades about 0.01 of its potential returns per unit of risk. EAGLE MATERIALS is currently generating about -0.25 per unit of risk. If you would invest 3,220 in Koninklijke Ahold Delhaize on September 13, 2024 and sell it today you would earn a total of 4.00 from holding Koninklijke Ahold Delhaize or generate 0.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koninklijke Ahold Delhaize vs. EAGLE MATERIALS
Performance |
| Timeline |
| Koninklijke Ahold |
| EAGLE MATERIALS |
Koninklijke Ahold and EAGLE MATERIALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koninklijke Ahold and EAGLE MATERIALS
The main advantage of trading using opposite Koninklijke Ahold and EAGLE MATERIALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koninklijke Ahold position performs unexpectedly, EAGLE MATERIALS 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 EAGLE MATERIALS will offset losses from the drop in EAGLE MATERIALS's long position.| Koninklijke Ahold vs. Taiwan Semiconductor Manufacturing | Koninklijke Ahold vs. ON SEMICONDUCTOR | Koninklijke Ahold vs. SEALED AIR | Koninklijke Ahold vs. MYFAIR GOLD P |
| EAGLE MATERIALS vs. Apple Inc | EAGLE MATERIALS vs. Apple Inc | EAGLE MATERIALS vs. Apple Inc | EAGLE MATERIALS vs. Apple Inc |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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