Correlation Between Aerodrome and Multi Retail
Can any of the company-specific risk be diversified away by investing in both Aerodrome and Multi Retail 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 Aerodrome and Multi Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aerodrome Group and Multi Retail Group, you can compare the effects of market volatilities on Aerodrome and Multi Retail 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 Aerodrome with a short position of Multi Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aerodrome and Multi Retail.
Diversification Opportunities for Aerodrome and Multi Retail
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aerodrome and Multi is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Aerodrome Group and Multi Retail Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Retail Group and Aerodrome 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 Aerodrome Group are associated (or correlated) with Multi Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Retail Group has no effect on the direction of Aerodrome i.e., Aerodrome and Multi Retail go up and down completely randomly.
Pair Corralation between Aerodrome and Multi Retail
Assuming the 90 days trading horizon Aerodrome Group is expected to under-perform the Multi Retail. In addition to that, Aerodrome is 4.78 times more volatile than Multi Retail Group. It trades about -0.17 of its total potential returns per unit of risk. Multi Retail Group is currently generating about -0.15 per unit of volatility. If you would invest 136,300 in Multi Retail Group on December 4, 2024 and sell it today you would lose (5,600) from holding Multi Retail Group or give up 4.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
Aerodrome Group vs. Multi Retail Group
Performance |
| Timeline |
| Aerodrome Group |
| Multi Retail Group |
Aerodrome and Multi Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aerodrome and Multi Retail
The main advantage of trading using opposite Aerodrome and Multi Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aerodrome position performs unexpectedly, Multi Retail 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 Multi Retail will offset losses from the drop in Multi Retail's long position.| Aerodrome vs. Scope Metals Group | Aerodrome vs. Migdal Insurance | Aerodrome vs. Rapac Communication Infrastructure | Aerodrome vs. Ilex Medical |
| Multi Retail vs. Iargento Hi Tech | Multi Retail vs. Sarine Technologies | Multi Retail vs. Suny Cellular Communication | Multi Retail vs. Polyram Plastic Industries |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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