Correlation Between ALBIS LEASING and Associated British
Can any of the company-specific risk be diversified away by investing in both ALBIS LEASING and Associated British 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 Associated British 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 Associated British Foods, you can compare the effects of market volatilities on ALBIS LEASING and Associated British 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 Associated British. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALBIS LEASING and Associated British.
Diversification Opportunities for ALBIS LEASING and Associated British
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ALBIS and Associated is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding ALBIS LEASING AG and Associated British Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Associated British Foods 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 Associated British. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Associated British Foods has no effect on the direction of ALBIS LEASING i.e., ALBIS LEASING and Associated British go up and down completely randomly.
Pair Corralation between ALBIS LEASING and Associated British
Assuming the 90 days trading horizon ALBIS LEASING is expected to generate 1.19 times less return on investment than Associated British. But when comparing it to its historical volatility, ALBIS LEASING AG is 1.85 times less risky than Associated British. It trades about 0.08 of its potential returns per unit of risk. Associated British Foods is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,776 in Associated British Foods on September 25, 2024 and sell it today you would earn a total of 699.00 from holding Associated British Foods or generate 39.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ALBIS LEASING AG vs. Associated British Foods
Performance |
| Timeline |
| ALBIS LEASING AG |
| Associated British Foods |
ALBIS LEASING and Associated British Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALBIS LEASING and Associated British
The main advantage of trading using opposite ALBIS LEASING and Associated British positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALBIS LEASING position performs unexpectedly, Associated British 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 Associated British will offset losses from the drop in Associated British's long position.| ALBIS LEASING vs. Apple Inc | ALBIS LEASING vs. Apple Inc | ALBIS LEASING vs. Apple Inc | ALBIS LEASING vs. Microsoft |
| Associated British vs. Mowi ASA | Associated British vs. LEROY SEAFOOD GRUNSPADR | Associated British vs. Lery Seafood Group | Associated British vs. Nisshin Seifun Group |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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