Correlation Between Athelney Trust and Givaudan
Can any of the company-specific risk be diversified away by investing in both Athelney Trust and Givaudan 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 Athelney Trust and Givaudan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Athelney Trust plc and Givaudan SA, you can compare the effects of market volatilities on Athelney Trust and Givaudan 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 Athelney Trust with a short position of Givaudan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Athelney Trust and Givaudan.
Diversification Opportunities for Athelney Trust and Givaudan
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Athelney and Givaudan is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Athelney Trust plc and Givaudan SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Givaudan SA and Athelney Trust 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 Athelney Trust plc are associated (or correlated) with Givaudan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Givaudan SA has no effect on the direction of Athelney Trust i.e., Athelney Trust and Givaudan go up and down completely randomly.
Pair Corralation between Athelney Trust and Givaudan
Assuming the 90 days trading horizon Athelney Trust plc is expected to generate 0.87 times more return on investment than Givaudan. However, Athelney Trust plc is 1.15 times less risky than Givaudan. It trades about 0.02 of its potential returns per unit of risk. Givaudan SA is currently generating about -0.07 per unit of risk. If you would invest 18,264 in Athelney Trust plc on November 2, 2024 and sell it today you would earn a total of 236.00 from holding Athelney Trust plc or generate 1.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Athelney Trust plc vs. Givaudan SA
Performance |
| Timeline |
| Athelney Trust plc |
| Givaudan SA |
Athelney Trust and Givaudan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Athelney Trust and Givaudan
The main advantage of trading using opposite Athelney Trust and Givaudan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Athelney Trust position performs unexpectedly, Givaudan 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 Givaudan will offset losses from the drop in Givaudan's long position.| Athelney Trust vs. Coor Service Management | Athelney Trust vs. Concurrent Technologies Plc | Athelney Trust vs. Ashtead Technology Holdings | Athelney Trust vs. Liontrust Asset Management |
| Givaudan vs. BE Semiconductor Industries | Givaudan vs. Ross Stores | Givaudan vs. British American Tobacco | Givaudan vs. Waste 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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