Correlation Between Aston Martin and Aston Martin
Can any of the company-specific risk be diversified away by investing in both Aston Martin and Aston Martin 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 Aston Martin and Aston Martin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aston Martin Lagonda and Aston Martin Lagonda, you can compare the effects of market volatilities on Aston Martin and Aston Martin 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 Aston Martin with a short position of Aston Martin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aston Martin and Aston Martin.
Diversification Opportunities for Aston Martin and Aston Martin
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aston and Aston is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Aston Martin Lagonda and Aston Martin Lagonda in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aston Martin Lagonda and Aston Martin 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 Aston Martin Lagonda are associated (or correlated) with Aston Martin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aston Martin Lagonda has no effect on the direction of Aston Martin i.e., Aston Martin and Aston Martin go up and down completely randomly.
Pair Corralation between Aston Martin and Aston Martin
Assuming the 90 days horizon Aston Martin Lagonda is expected to generate 1.54 times more return on investment than Aston Martin. However, Aston Martin is 1.54 times more volatile than Aston Martin Lagonda. It trades about 0.02 of its potential returns per unit of risk. Aston Martin Lagonda is currently generating about 0.0 per unit of risk. If you would invest 178.00 in Aston Martin Lagonda on August 24, 2024 and sell it today you would lose (45.00) from holding Aston Martin Lagonda or give up 25.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aston Martin Lagonda vs. Aston Martin Lagonda
Performance |
| Timeline |
| Aston Martin Lagonda |
| Aston Martin Lagonda |
Aston Martin and Aston Martin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aston Martin and Aston Martin
The main advantage of trading using opposite Aston Martin and Aston Martin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aston Martin position performs unexpectedly, Aston Martin 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 Aston Martin will offset losses from the drop in Aston Martin's long position.| Aston Martin vs. Isuzu Motors | Aston Martin vs. Renault SA | Aston Martin vs. Mazda Motor Corp | Aston Martin vs. Bayerische Motoren Werke |
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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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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