Correlation Between AEON STORES and AHLERS
Can any of the company-specific risk be diversified away by investing in both AEON STORES and AHLERS 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 AEON STORES and AHLERS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AEON STORES and AHLERS, you can compare the effects of market volatilities on AEON STORES and AHLERS 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 AEON STORES with a short position of AHLERS. Check out your portfolio center. Please also check ongoing floating volatility patterns of AEON STORES and AHLERS.
Diversification Opportunities for AEON STORES and AHLERS
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between AEON and AHLERS is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding AEON STORES and AHLERS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AHLERS and AEON STORES 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 AEON STORES are associated (or correlated) with AHLERS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AHLERS has no effect on the direction of AEON STORES i.e., AEON STORES and AHLERS go up and down completely randomly.
Pair Corralation between AEON STORES and AHLERS
Assuming the 90 days trading horizon AEON STORES is expected to generate 0.7 times more return on investment than AHLERS. However, AEON STORES is 1.43 times less risky than AHLERS. It trades about -0.06 of its potential returns per unit of risk. AHLERS is currently generating about -0.43 per unit of risk. If you would invest 6.05 in AEON STORES on October 17, 2024 and sell it today you would lose (0.15) from holding AEON STORES or give up 2.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AEON STORES vs. AHLERS
Performance |
| Timeline |
| AEON STORES |
| AHLERS |
AEON STORES and AHLERS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AEON STORES and AHLERS
The main advantage of trading using opposite AEON STORES and AHLERS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AEON STORES position performs unexpectedly, AHLERS 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 AHLERS will offset losses from the drop in AHLERS's long position.| AEON STORES vs. Keck Seng Investments | AEON STORES vs. Guangdong Investment Limited | AEON STORES vs. JD SPORTS FASH | AEON STORES vs. Jacquet Metal Service |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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