Correlation Between Ashtead Technology and Las Vegas
Can any of the company-specific risk be diversified away by investing in both Ashtead Technology and Las Vegas 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 Ashtead Technology and Las Vegas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashtead Technology Holdings and Las Vegas Sands, you can compare the effects of market volatilities on Ashtead Technology and Las Vegas 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 Ashtead Technology with a short position of Las Vegas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashtead Technology and Las Vegas.
Diversification Opportunities for Ashtead Technology and Las Vegas
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ashtead and Las is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ashtead Technology Holdings and Las Vegas Sands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Las Vegas Sands and Ashtead Technology 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 Ashtead Technology Holdings are associated (or correlated) with Las Vegas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Las Vegas Sands has no effect on the direction of Ashtead Technology i.e., Ashtead Technology and Las Vegas go up and down completely randomly.
Pair Corralation between Ashtead Technology and Las Vegas
Assuming the 90 days trading horizon Ashtead Technology Holdings is expected to generate 1.79 times more return on investment than Las Vegas. However, Ashtead Technology is 1.79 times more volatile than Las Vegas Sands. It trades about 0.12 of its potential returns per unit of risk. Las Vegas Sands is currently generating about -0.49 per unit of risk. If you would invest 51,700 in Ashtead Technology Holdings on October 21, 2024 and sell it today you would earn a total of 2,900 from holding Ashtead Technology Holdings or generate 5.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Ashtead Technology Holdings vs. Las Vegas Sands
Performance |
| Timeline |
| Ashtead Technology |
| Las Vegas Sands |
Ashtead Technology and Las Vegas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashtead Technology and Las Vegas
The main advantage of trading using opposite Ashtead Technology and Las Vegas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashtead Technology position performs unexpectedly, Las Vegas 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 Las Vegas will offset losses from the drop in Las Vegas' long position.| Ashtead Technology vs. Broadcom | Ashtead Technology vs. Samsung Electronics Co | Ashtead Technology vs. Alien Metals | Ashtead Technology vs. Gaztransport et Technigaz |
| Las Vegas vs. Eneraqua Technologies PLC | Las Vegas vs. Ashtead Technology Holdings | Las Vegas vs. Concurrent Technologies Plc | Las Vegas vs. Polar Capital Technology |
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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