Correlation Between ALBIS LEASING and Liberty Broadband
Can any of the company-specific risk be diversified away by investing in both ALBIS LEASING and Liberty Broadband 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 ALBIS LEASING and Liberty Broadband into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALBIS LEASING AG and Liberty Broadband, you can compare the effects of market volatilities on ALBIS LEASING and Liberty Broadband 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 ALBIS LEASING with a short position of Liberty Broadband. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALBIS LEASING and Liberty Broadband.
Diversification Opportunities for ALBIS LEASING and Liberty Broadband
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ALBIS and Liberty is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding ALBIS LEASING AG and Liberty Broadband in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liberty Broadband and ALBIS LEASING 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 ALBIS LEASING AG are associated (or correlated) with Liberty Broadband. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liberty Broadband has no effect on the direction of ALBIS LEASING i.e., ALBIS LEASING and Liberty Broadband go up and down completely randomly.
Pair Corralation between ALBIS LEASING and Liberty Broadband
Assuming the 90 days trading horizon ALBIS LEASING AG is expected to generate 0.79 times more return on investment than Liberty Broadband. However, ALBIS LEASING AG is 1.26 times less risky than Liberty Broadband. It trades about -0.08 of its potential returns per unit of risk. Liberty Broadband is currently generating about -0.38 per unit of risk. If you would invest 278.00 in ALBIS LEASING AG on October 16, 2024 and sell it today you would lose (4.00) from holding ALBIS LEASING AG or give up 1.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ALBIS LEASING AG vs. Liberty Broadband
Performance |
| Timeline |
| ALBIS LEASING AG |
| Liberty Broadband |
ALBIS LEASING and Liberty Broadband Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALBIS LEASING and Liberty Broadband
The main advantage of trading using opposite ALBIS LEASING and Liberty Broadband positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALBIS LEASING position performs unexpectedly, Liberty Broadband 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 Liberty Broadband will offset losses from the drop in Liberty Broadband's long position.| ALBIS LEASING vs. STMicroelectronics NV | ALBIS LEASING vs. Singapore Airlines Limited | ALBIS LEASING vs. TT Electronics PLC | ALBIS LEASING vs. AOI Electronics Co |
| Liberty Broadband vs. FARM 51 GROUP | Liberty Broadband vs. Australian Agricultural | Liberty Broadband vs. Federal Agricultural Mortgage | Liberty Broadband vs. Casio Computer CoLtd |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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