Correlation Between Ashtead Technology and Fair Oaks
Can any of the company-specific risk be diversified away by investing in both Ashtead Technology and Fair Oaks 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 Fair Oaks 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 Fair Oaks Income, you can compare the effects of market volatilities on Ashtead Technology and Fair Oaks 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 Fair Oaks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashtead Technology and Fair Oaks.
Diversification Opportunities for Ashtead Technology and Fair Oaks
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ashtead and Fair is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Ashtead Technology Holdings and Fair Oaks Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fair Oaks Income 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 Fair Oaks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fair Oaks Income has no effect on the direction of Ashtead Technology i.e., Ashtead Technology and Fair Oaks go up and down completely randomly.
Pair Corralation between Ashtead Technology and Fair Oaks
If you would invest 52,400 in Ashtead Technology Holdings on September 25, 2024 and sell it today you would earn a total of 1,200 from holding Ashtead Technology Holdings or generate 2.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashtead Technology Holdings vs. Fair Oaks Income
Performance |
| Timeline |
| Ashtead Technology |
| Fair Oaks Income |
Ashtead Technology and Fair Oaks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashtead Technology and Fair Oaks
The main advantage of trading using opposite Ashtead Technology and Fair Oaks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashtead Technology position performs unexpectedly, Fair Oaks 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 Fair Oaks will offset losses from the drop in Fair Oaks' long position.| Ashtead Technology vs. Hansa Investment | Ashtead Technology vs. Lords Grp Trading | Ashtead Technology vs. The Mercantile Investment | Ashtead Technology vs. Norman Broadbent Plc |
| Fair Oaks vs. Roper Technologies | Fair Oaks vs. Cairn Homes PLC | Fair Oaks vs. Ashtead Technology Holdings | Fair Oaks vs. bet at home AG |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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