Correlation Between ABACUS STORAGE and Ampol
Can any of the company-specific risk be diversified away by investing in both ABACUS STORAGE and Ampol 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 ABACUS STORAGE and Ampol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABACUS STORAGE KING and Ampol, you can compare the effects of market volatilities on ABACUS STORAGE and Ampol 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 ABACUS STORAGE with a short position of Ampol. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABACUS STORAGE and Ampol.
Diversification Opportunities for ABACUS STORAGE and Ampol
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ABACUS and Ampol is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding ABACUS STORAGE KING and Ampol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ampol and ABACUS STORAGE 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 ABACUS STORAGE KING are associated (or correlated) with Ampol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ampol has no effect on the direction of ABACUS STORAGE i.e., ABACUS STORAGE and Ampol go up and down completely randomly.
Pair Corralation between ABACUS STORAGE and Ampol
Assuming the 90 days trading horizon ABACUS STORAGE KING is expected to generate 1.3 times more return on investment than Ampol. However, ABACUS STORAGE is 1.3 times more volatile than Ampol. It trades about 0.02 of its potential returns per unit of risk. Ampol is currently generating about -0.08 per unit of risk. If you would invest 117.00 in ABACUS STORAGE KING on September 2, 2024 and sell it today you would earn a total of 4.00 from holding ABACUS STORAGE KING or generate 3.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABACUS STORAGE KING vs. Ampol
Performance |
| Timeline |
| ABACUS STORAGE KING |
| Ampol |
ABACUS STORAGE and Ampol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABACUS STORAGE and Ampol
The main advantage of trading using opposite ABACUS STORAGE and Ampol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABACUS STORAGE position performs unexpectedly, Ampol 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 Ampol will offset losses from the drop in Ampol's long position.| ABACUS STORAGE vs. Westpac Banking | ABACUS STORAGE vs. Odyssey Energy | ABACUS STORAGE vs. Imricor Medical Systems | ABACUS STORAGE vs. Midway |
| Ampol vs. Event Hospitality and | Ampol vs. Microequities Asset Management | Ampol vs. Austco Healthcare | Ampol vs. Pinnacle Investment Management |
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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