Correlation Between Anheuser Busch and GENERAL
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By analyzing existing cross correlation between Anheuser Busch Inbev and GENERAL ELEC CAP, you can compare the effects of market volatilities on Anheuser Busch and GENERAL 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 Anheuser Busch with a short position of GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anheuser Busch and GENERAL.
Diversification Opportunities for Anheuser Busch and GENERAL
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Anheuser and GENERAL is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Anheuser Busch Inbev and GENERAL ELEC CAP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENERAL ELEC CAP and Anheuser Busch 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 Anheuser Busch Inbev are associated (or correlated) with GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GENERAL ELEC CAP has no effect on the direction of Anheuser Busch i.e., Anheuser Busch and GENERAL go up and down completely randomly.
Pair Corralation between Anheuser Busch and GENERAL
Considering the 90-day investment horizon Anheuser Busch Inbev is expected to under-perform the GENERAL. But the stock apears to be less risky and, when comparing its historical volatility, Anheuser Busch Inbev is 1.54 times less risky than GENERAL. The stock trades about -0.08 of its potential returns per unit of risk. The GENERAL ELEC CAP is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 9,575 in GENERAL ELEC CAP on September 2, 2024 and sell it today you would lose (474.00) from holding GENERAL ELEC CAP or give up 4.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 45.24% |
| Values | Daily Returns |
Anheuser Busch Inbev vs. GENERAL ELEC CAP
Performance |
| Timeline |
| Anheuser Busch Inbev |
| GENERAL ELEC CAP |
Anheuser Busch and GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anheuser Busch and GENERAL
The main advantage of trading using opposite Anheuser Busch and GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anheuser Busch position performs unexpectedly, GENERAL 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 GENERAL will offset losses from the drop in GENERAL's long position.| Anheuser Busch vs. Boston Beer | Anheuser Busch vs. Molson Coors Beverage | Anheuser Busch vs. Heineken NV | Anheuser Busch vs. Ambev SA ADR |
| GENERAL vs. AEP TEX INC | GENERAL vs. US BANK NATIONAL | GENERAL vs. American Express | GENERAL vs. Chevron Corp |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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