Correlation Between ASSA ABLOY and MINCO SILVER
Can any of the company-specific risk be diversified away by investing in both ASSA ABLOY and MINCO SILVER 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 ASSA ABLOY and MINCO SILVER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASSA ABLOY AB and MINCO SILVER, you can compare the effects of market volatilities on ASSA ABLOY and MINCO SILVER 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 ASSA ABLOY with a short position of MINCO SILVER. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASSA ABLOY and MINCO SILVER.
Diversification Opportunities for ASSA ABLOY and MINCO SILVER
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between ASSA and MINCO is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding ASSA ABLOY AB and MINCO SILVER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MINCO SILVER and ASSA ABLOY 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 ASSA ABLOY AB are associated (or correlated) with MINCO SILVER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MINCO SILVER has no effect on the direction of ASSA ABLOY i.e., ASSA ABLOY and MINCO SILVER go up and down completely randomly.
Pair Corralation between ASSA ABLOY and MINCO SILVER
Assuming the 90 days trading horizon ASSA ABLOY is expected to generate 6.05 times less return on investment than MINCO SILVER. But when comparing it to its historical volatility, ASSA ABLOY AB is 2.87 times less risky than MINCO SILVER. It trades about 0.05 of its potential returns per unit of risk. MINCO SILVER is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 12.00 in MINCO SILVER on November 7, 2024 and sell it today you would earn a total of 1.00 from holding MINCO SILVER or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
ASSA ABLOY AB vs. MINCO SILVER
Performance |
| Timeline |
| ASSA ABLOY AB |
| MINCO SILVER |
ASSA ABLOY and MINCO SILVER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASSA ABLOY and MINCO SILVER
The main advantage of trading using opposite ASSA ABLOY and MINCO SILVER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASSA ABLOY position performs unexpectedly, MINCO SILVER 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 MINCO SILVER will offset losses from the drop in MINCO SILVER's long position.| ASSA ABLOY vs. PennantPark Investment | ASSA ABLOY vs. Guangdong Investment Limited | ASSA ABLOY vs. Townsquare Media | ASSA ABLOY vs. Ubisoft Entertainment SA |
| MINCO SILVER vs. Aristocrat Leisure Limited | MINCO SILVER vs. LG Display Co | MINCO SILVER vs. USWE SPORTS AB | MINCO SILVER vs. Universal Display |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |