Correlation Between Auto Trader and Tinybeans Group
Can any of the company-specific risk be diversified away by investing in both Auto Trader and Tinybeans 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 Auto Trader and Tinybeans Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auto Trader Group and Tinybeans Group Limited, you can compare the effects of market volatilities on Auto Trader and Tinybeans 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 Auto Trader with a short position of Tinybeans Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auto Trader and Tinybeans Group.
Diversification Opportunities for Auto Trader and Tinybeans Group
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Auto and Tinybeans is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Auto Trader Group and Tinybeans Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tinybeans Group and Auto Trader 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 Auto Trader Group are associated (or correlated) with Tinybeans Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tinybeans Group has no effect on the direction of Auto Trader i.e., Auto Trader and Tinybeans Group go up and down completely randomly.
Pair Corralation between Auto Trader and Tinybeans Group
Assuming the 90 days horizon Auto Trader Group is expected to generate 0.16 times more return on investment than Tinybeans Group. However, Auto Trader Group is 6.34 times less risky than Tinybeans Group. It trades about -0.2 of its potential returns per unit of risk. Tinybeans Group Limited is currently generating about -0.33 per unit of risk. If you would invest 247.00 in Auto Trader Group on October 26, 2024 and sell it today you would lose (10.00) from holding Auto Trader Group or give up 4.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Auto Trader Group vs. Tinybeans Group Limited
Performance |
| Timeline |
| Auto Trader Group |
| Tinybeans Group |
Auto Trader and Tinybeans Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auto Trader and Tinybeans Group
The main advantage of trading using opposite Auto Trader and Tinybeans Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auto Trader position performs unexpectedly, Tinybeans 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 Tinybeans Group will offset losses from the drop in Tinybeans Group's long position.| Auto Trader vs. Tinybeans Group Limited | Auto Trader vs. DGTL Holdings | Auto Trader vs. Sabio Holdings | Auto Trader vs. Zoomd Technologies |
| Tinybeans Group vs. Brunswick | Tinybeans Group vs. Wabash National | Tinybeans Group vs. Valmont Industries | Tinybeans Group vs. MYR Group |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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