Correlation Between Asseco South and Investment Friends
Can any of the company-specific risk be diversified away by investing in both Asseco South and Investment Friends 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 Asseco South and Investment Friends into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asseco South Eastern and Investment Friends Capital, you can compare the effects of market volatilities on Asseco South and Investment Friends 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 Asseco South with a short position of Investment Friends. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asseco South and Investment Friends.
Diversification Opportunities for Asseco South and Investment Friends
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Asseco and Investment is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Asseco South Eastern and Investment Friends Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investment Friends and Asseco South 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 Asseco South Eastern are associated (or correlated) with Investment Friends. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investment Friends has no effect on the direction of Asseco South i.e., Asseco South and Investment Friends go up and down completely randomly.
Pair Corralation between Asseco South and Investment Friends
Assuming the 90 days trading horizon Asseco South is expected to generate 63.21 times less return on investment than Investment Friends. But when comparing it to its historical volatility, Asseco South Eastern is 32.65 times less risky than Investment Friends. It trades about 0.03 of its potential returns per unit of risk. Investment Friends Capital is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 102.00 in Investment Friends Capital on September 2, 2024 and sell it today you would earn a total of 428.00 from holding Investment Friends Capital or generate 419.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 72.38% |
| Values | Daily Returns |
Asseco South Eastern vs. Investment Friends Capital
Performance |
| Timeline |
| Asseco South Eastern |
| Investment Friends |
Asseco South and Investment Friends Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asseco South and Investment Friends
The main advantage of trading using opposite Asseco South and Investment Friends positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asseco South position performs unexpectedly, Investment Friends 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 Investment Friends will offset losses from the drop in Investment Friends' long position.| Asseco South vs. Banco Santander SA | Asseco South vs. UniCredit SpA | Asseco South vs. CEZ as | Asseco South vs. Polski Koncern Naftowy |
| Investment Friends vs. Asseco Business Solutions | Investment Friends vs. Detalion Games SA | Investment Friends vs. Asseco South Eastern | Investment Friends vs. CFI Holding SA |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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