Correlation Between Brederode and Ackermans Van
Can any of the company-specific risk be diversified away by investing in both Brederode and Ackermans Van 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 Brederode and Ackermans Van into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brederode SA and Ackermans Van Haaren, you can compare the effects of market volatilities on Brederode and Ackermans Van 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 Brederode with a short position of Ackermans Van. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brederode and Ackermans Van.
Diversification Opportunities for Brederode and Ackermans Van
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Brederode and Ackermans is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Brederode SA and Ackermans Van Haaren in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ackermans Van Haaren and Brederode 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 Brederode SA are associated (or correlated) with Ackermans Van. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ackermans Van Haaren has no effect on the direction of Brederode i.e., Brederode and Ackermans Van go up and down completely randomly.
Pair Corralation between Brederode and Ackermans Van
Assuming the 90 days trading horizon Brederode SA is expected to generate 1.15 times more return on investment than Ackermans Van. However, Brederode is 1.15 times more volatile than Ackermans Van Haaren. It trades about 0.4 of its potential returns per unit of risk. Ackermans Van Haaren is currently generating about 0.2 per unit of risk. If you would invest 10,760 in Brederode SA on October 23, 2024 and sell it today you would earn a total of 800.00 from holding Brederode SA or generate 7.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brederode SA vs. Ackermans Van Haaren
Performance |
| Timeline |
| Brederode SA |
| Ackermans Van Haaren |
Brederode and Ackermans Van Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brederode and Ackermans Van
The main advantage of trading using opposite Brederode and Ackermans Van positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brederode position performs unexpectedly, Ackermans Van 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 Ackermans Van will offset losses from the drop in Ackermans Van's long position.| Brederode vs. Keyware Technologies NV | Brederode vs. Home Invest Belgium | Brederode vs. Ion Beam Applications | Brederode vs. Retail Estates |
| Ackermans Van vs. Sofina Socit Anonyme | Ackermans Van vs. Groep Brussel Lambert | Ackermans Van vs. Brederode SA | Ackermans Van vs. Solvay SA |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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