Correlation Between Auto Trader and Brunner Investment
Can any of the company-specific risk be diversified away by investing in both Auto Trader and Brunner Investment 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 Brunner Investment 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 Brunner Investment Trust, you can compare the effects of market volatilities on Auto Trader and Brunner Investment 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 Brunner Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auto Trader and Brunner Investment.
Diversification Opportunities for Auto Trader and Brunner Investment
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Auto and Brunner is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Auto Trader Group and Brunner Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brunner Investment Trust 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 Brunner Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brunner Investment Trust has no effect on the direction of Auto Trader i.e., Auto Trader and Brunner Investment go up and down completely randomly.
Pair Corralation between Auto Trader and Brunner Investment
Assuming the 90 days trading horizon Auto Trader is expected to generate 9.84 times less return on investment than Brunner Investment. In addition to that, Auto Trader is 1.43 times more volatile than Brunner Investment Trust. It trades about 0.01 of its total potential returns per unit of risk. Brunner Investment Trust is currently generating about 0.12 per unit of volatility. If you would invest 141,500 in Brunner Investment Trust on September 1, 2024 and sell it today you would earn a total of 4,500 from holding Brunner Investment Trust or generate 3.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Auto Trader Group vs. Brunner Investment Trust
Performance |
| Timeline |
| Auto Trader Group |
| Brunner Investment Trust |
Auto Trader and Brunner Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auto Trader and Brunner Investment
The main advantage of trading using opposite Auto Trader and Brunner Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auto Trader position performs unexpectedly, Brunner Investment 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 Brunner Investment will offset losses from the drop in Brunner Investment's long position.| Auto Trader vs. Catalyst Media Group | Auto Trader vs. Tamburi Investment Partners | Auto Trader vs. Magnora ASA | Auto Trader vs. RTW Venture Fund |
| Brunner Investment vs. Samsung Electronics Co | Brunner Investment vs. Virgin Wines UK | Brunner Investment vs. Air Products Chemicals | Brunner Investment vs. Hansa Investment |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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