Correlation Between Afine Investments and We Buy
Can any of the company-specific risk be diversified away by investing in both Afine Investments and We Buy 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 Afine Investments and We Buy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Afine Investments and We Buy Cars, you can compare the effects of market volatilities on Afine Investments and We Buy 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 Afine Investments with a short position of We Buy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Afine Investments and We Buy.
Diversification Opportunities for Afine Investments and We Buy
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Afine and WBC is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Afine Investments and We Buy Cars in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on We Buy Cars and Afine Investments 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 Afine Investments are associated (or correlated) with We Buy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of We Buy Cars has no effect on the direction of Afine Investments i.e., Afine Investments and We Buy go up and down completely randomly.
Pair Corralation between Afine Investments and We Buy
If you would invest 342,500 in We Buy Cars on August 24, 2024 and sell it today you would earn a total of 85,400 from holding We Buy Cars or generate 24.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Afine Investments vs. We Buy Cars
Performance |
| Timeline |
| Afine Investments |
| We Buy Cars |
Afine Investments and We Buy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Afine Investments and We Buy
The main advantage of trading using opposite Afine Investments and We Buy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Afine Investments position performs unexpectedly, We Buy 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 We Buy will offset losses from the drop in We Buy's long position.| Afine Investments vs. Sasol Ltd Bee | Afine Investments vs. Centaur Bci Balanced | Afine Investments vs. Sabvest Capital | Afine Investments vs. Growthpoint Properties |
| We Buy vs. RCL Foods | We Buy vs. HomeChoice Investments | We Buy vs. Afine Investments | We Buy vs. Bytes Technology |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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