Correlation Between Asseco South and MLP Group
Can any of the company-specific risk be diversified away by investing in both Asseco South and MLP Group 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 MLP Group 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 MLP Group SA, you can compare the effects of market volatilities on Asseco South and MLP Group 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 MLP Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asseco South and MLP Group.
Diversification Opportunities for Asseco South and MLP Group
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Asseco and MLP is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Asseco South Eastern and MLP Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MLP Group SA 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 MLP Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MLP Group SA has no effect on the direction of Asseco South i.e., Asseco South and MLP Group go up and down completely randomly.
Pair Corralation between Asseco South and MLP Group
Assuming the 90 days trading horizon Asseco South Eastern is expected to generate 0.66 times more return on investment than MLP Group. However, Asseco South Eastern is 1.52 times less risky than MLP Group. It trades about -0.03 of its potential returns per unit of risk. MLP Group SA is currently generating about -0.23 per unit of risk. If you would invest 4,890 in Asseco South Eastern on August 27, 2024 and sell it today you would lose (100.00) from holding Asseco South Eastern or give up 2.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asseco South Eastern vs. MLP Group SA
Performance |
| Timeline |
| Asseco South Eastern |
| MLP Group SA |
Asseco South and MLP Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asseco South and MLP Group
The main advantage of trading using opposite Asseco South and MLP Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asseco South position performs unexpectedly, MLP Group 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 MLP Group will offset losses from the drop in MLP Group's long position.| Asseco South vs. Banco Santander SA | Asseco South vs. UniCredit SpA | Asseco South vs. CEZ as | Asseco South vs. Polski Koncern Naftowy |
| MLP Group vs. Globe Trade Centre | MLP Group vs. Asseco Business Solutions | MLP Group vs. Detalion Games SA | MLP Group vs. Asseco South Eastern |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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