Correlation Between Azerion Group and Flow Traders
Can any of the company-specific risk be diversified away by investing in both Azerion Group and Flow Traders 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 Azerion Group and Flow Traders into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Azerion Group NV and Flow Traders BV, you can compare the effects of market volatilities on Azerion Group and Flow Traders 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 Azerion Group with a short position of Flow Traders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azerion Group and Flow Traders.
Diversification Opportunities for Azerion Group and Flow Traders
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Azerion and Flow is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Azerion Group NV and Flow Traders BV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flow Traders BV and Azerion Group 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 Azerion Group NV are associated (or correlated) with Flow Traders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flow Traders BV has no effect on the direction of Azerion Group i.e., Azerion Group and Flow Traders go up and down completely randomly.
Pair Corralation between Azerion Group and Flow Traders
Assuming the 90 days trading horizon Azerion Group NV is expected to under-perform the Flow Traders. In addition to that, Azerion Group is 2.0 times more volatile than Flow Traders BV. It trades about -0.09 of its total potential returns per unit of risk. Flow Traders BV is currently generating about 0.06 per unit of volatility. If you would invest 2,046 in Flow Traders BV on September 5, 2024 and sell it today you would earn a total of 40.00 from holding Flow Traders BV or generate 1.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Azerion Group NV vs. Flow Traders BV
Performance |
| Timeline |
| Azerion Group NV |
| Flow Traders BV |
Azerion Group and Flow Traders Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Azerion Group and Flow Traders
The main advantage of trading using opposite Azerion Group and Flow Traders positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Azerion Group position performs unexpectedly, Flow Traders 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 Flow Traders will offset losses from the drop in Flow Traders' long position.| Azerion Group vs. Flow Traders BV | Azerion Group vs. Vastned Retail NV | Azerion Group vs. Reinet Investments SCA | Azerion Group vs. BE Semiconductor Industries |
| Flow Traders vs. Aegon NV | Flow Traders vs. ABN Amro Group | Flow Traders vs. Koninklijke Philips NV | Flow Traders vs. Unilever PLC |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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