Correlation Between Airport City and Ashtrom
Can any of the company-specific risk be diversified away by investing in both Airport City and Ashtrom 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 Airport City and Ashtrom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airport City and Ashtrom Group, you can compare the effects of market volatilities on Airport City and Ashtrom 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 Airport City with a short position of Ashtrom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airport City and Ashtrom.
Diversification Opportunities for Airport City and Ashtrom
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Airport and Ashtrom is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Airport City and Ashtrom Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashtrom Group and Airport City 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 Airport City are associated (or correlated) with Ashtrom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashtrom Group has no effect on the direction of Airport City i.e., Airport City and Ashtrom go up and down completely randomly.
Pair Corralation between Airport City and Ashtrom
Assuming the 90 days trading horizon Airport City is expected to generate 1.55 times less return on investment than Ashtrom. But when comparing it to its historical volatility, Airport City is 1.38 times less risky than Ashtrom. It trades about 0.41 of its potential returns per unit of risk. Ashtrom Group is currently generating about 0.46 of returns per unit of risk over similar time horizon. If you would invest 562,100 in Ashtrom Group on September 3, 2024 and sell it today you would earn a total of 74,700 from holding Ashtrom Group or generate 13.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airport City vs. Ashtrom Group
Performance |
| Timeline |
| Airport City |
| Ashtrom Group |
Airport City and Ashtrom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airport City and Ashtrom
The main advantage of trading using opposite Airport City and Ashtrom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airport City position performs unexpectedly, Ashtrom 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 Ashtrom will offset losses from the drop in Ashtrom's long position.| Airport City vs. Melisron | Airport City vs. Alony Hetz Properties | Airport City vs. Amot Investments | Airport City vs. Azrieli Group |
| Ashtrom vs. Shikun Binui | Ashtrom vs. Alony Hetz Properties | Ashtrom vs. Amot Investments | Ashtrom vs. Azrieli Group |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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