Correlation Between Allegion PLC and East Africa
Can any of the company-specific risk be diversified away by investing in both Allegion PLC and East Africa 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 Allegion PLC and East Africa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allegion PLC and East Africa Metals, you can compare the effects of market volatilities on Allegion PLC and East Africa 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 Allegion PLC with a short position of East Africa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allegion PLC and East Africa.
Diversification Opportunities for Allegion PLC and East Africa
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Allegion and East is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Allegion PLC and East Africa Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East Africa Metals and Allegion PLC 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 Allegion PLC are associated (or correlated) with East Africa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East Africa Metals has no effect on the direction of Allegion PLC i.e., Allegion PLC and East Africa go up and down completely randomly.
Pair Corralation between Allegion PLC and East Africa
If you would invest 12,840 in Allegion PLC on November 9, 2024 and sell it today you would earn a total of 90.00 from holding Allegion PLC or generate 0.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Allegion PLC vs. East Africa Metals
Performance |
| Timeline |
| Allegion PLC |
| East Africa Metals |
Allegion PLC and East Africa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allegion PLC and East Africa
The main advantage of trading using opposite Allegion PLC and East Africa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allegion PLC position performs unexpectedly, East Africa 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 East Africa will offset losses from the drop in East Africa's long position.| Allegion PLC vs. MSA Safety | Allegion PLC vs. Resideo Technologies | Allegion PLC vs. NL Industries | Allegion PLC vs. Brady |
| East Africa vs. Pasinex Resources Limited | East Africa vs. Commander Resources | East Africa vs. Forsys Metals Corp | East Africa vs. American CuMo Mining |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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