Correlation Between Asseco South and Skyline Investment
Can any of the company-specific risk be diversified away by investing in both Asseco South and Skyline Investment 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 Skyline Investment 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 Skyline Investment SA, you can compare the effects of market volatilities on Asseco South and Skyline Investment 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 Skyline Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asseco South and Skyline Investment.
Diversification Opportunities for Asseco South and Skyline Investment
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Asseco and Skyline is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Asseco South Eastern and Skyline Investment SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skyline Investment 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 Skyline Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skyline Investment has no effect on the direction of Asseco South i.e., Asseco South and Skyline Investment go up and down completely randomly.
Pair Corralation between Asseco South and Skyline Investment
Assuming the 90 days trading horizon Asseco South Eastern is expected to under-perform the Skyline Investment. But the stock apears to be less risky and, when comparing its historical volatility, Asseco South Eastern is 2.02 times less risky than Skyline Investment. The stock trades about -0.12 of its potential returns per unit of risk. The Skyline Investment SA is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 155.00 in Skyline Investment SA on September 5, 2024 and sell it today you would lose (3.00) from holding Skyline Investment SA or give up 1.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Asseco South Eastern vs. Skyline Investment SA
Performance |
| Timeline |
| Asseco South Eastern |
| Skyline Investment |
Asseco South and Skyline Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asseco South and Skyline Investment
The main advantage of trading using opposite Asseco South and Skyline Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asseco South position performs unexpectedly, Skyline Investment 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 Skyline Investment will offset losses from the drop in Skyline Investment'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 |
| Skyline Investment vs. Asseco Business Solutions | Skyline Investment vs. Kogeneracja SA | Skyline Investment vs. Asseco South Eastern | Skyline Investment vs. Movie Games 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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