Correlation Between AFC Ajax and Corticeira Amorim
Can any of the company-specific risk be diversified away by investing in both AFC Ajax and Corticeira Amorim 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 AFC Ajax and Corticeira Amorim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AFC Ajax NV and Corticeira Amorim, you can compare the effects of market volatilities on AFC Ajax and Corticeira Amorim 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 AFC Ajax with a short position of Corticeira Amorim. Check out your portfolio center. Please also check ongoing floating volatility patterns of AFC Ajax and Corticeira Amorim.
Diversification Opportunities for AFC Ajax and Corticeira Amorim
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AFC and Corticeira is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding AFC Ajax NV and Corticeira Amorim in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corticeira Amorim and AFC Ajax 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 AFC Ajax NV are associated (or correlated) with Corticeira Amorim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corticeira Amorim has no effect on the direction of AFC Ajax i.e., AFC Ajax and Corticeira Amorim go up and down completely randomly.
Pair Corralation between AFC Ajax and Corticeira Amorim
Assuming the 90 days trading horizon AFC Ajax NV is expected to generate 0.71 times more return on investment than Corticeira Amorim. However, AFC Ajax NV is 1.4 times less risky than Corticeira Amorim. It trades about 0.05 of its potential returns per unit of risk. Corticeira Amorim is currently generating about -0.02 per unit of risk. If you would invest 996.00 in AFC Ajax NV on September 1, 2024 and sell it today you would earn a total of 9.00 from holding AFC Ajax NV or generate 0.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
AFC Ajax NV vs. Corticeira Amorim
Performance |
| Timeline |
| AFC Ajax NV |
| Corticeira Amorim |
AFC Ajax and Corticeira Amorim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AFC Ajax and Corticeira Amorim
The main advantage of trading using opposite AFC Ajax and Corticeira Amorim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AFC Ajax position performs unexpectedly, Corticeira Amorim 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 Corticeira Amorim will offset losses from the drop in Corticeira Amorim's long position.| AFC Ajax vs. Universal Music Group | AFC Ajax vs. AMG Advanced Metallurgical | AFC Ajax vs. Reinet Investments SCA | AFC Ajax vs. Sligro Food Group |
| Corticeira Amorim vs. Altri SGPS SA | Corticeira Amorim vs. The Navigator | Corticeira Amorim vs. Sonae SGPS SA | Corticeira Amorim vs. Semapa |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |