Correlation Between Inter Cars and Asseco Business
Can any of the company-specific risk be diversified away by investing in both Inter Cars and Asseco Business 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 Inter Cars and Asseco Business into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inter Cars SA and Asseco Business Solutions, you can compare the effects of market volatilities on Inter Cars and Asseco Business 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 Inter Cars with a short position of Asseco Business. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inter Cars and Asseco Business.
Diversification Opportunities for Inter Cars and Asseco Business
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Inter and Asseco is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Inter Cars SA and Asseco Business Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asseco Business Solutions and Inter Cars 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 Inter Cars SA are associated (or correlated) with Asseco Business. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asseco Business Solutions has no effect on the direction of Inter Cars i.e., Inter Cars and Asseco Business go up and down completely randomly.
Pair Corralation between Inter Cars and Asseco Business
Assuming the 90 days trading horizon Inter Cars SA is expected to generate 0.83 times more return on investment than Asseco Business. However, Inter Cars SA is 1.2 times less risky than Asseco Business. It trades about 0.19 of its potential returns per unit of risk. Asseco Business Solutions is currently generating about 0.03 per unit of risk. If you would invest 48,250 in Inter Cars SA on September 14, 2024 and sell it today you would earn a total of 3,350 from holding Inter Cars SA or generate 6.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inter Cars SA vs. Asseco Business Solutions
Performance |
| Timeline |
| Inter Cars SA |
| Asseco Business Solutions |
Inter Cars and Asseco Business Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inter Cars and Asseco Business
The main advantage of trading using opposite Inter Cars and Asseco Business positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inter Cars position performs unexpectedly, Asseco Business 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 Asseco Business will offset losses from the drop in Asseco Business' long position.| Inter Cars vs. Banco Santander SA | Inter Cars vs. UniCredit SpA | Inter Cars vs. CEZ as | Inter Cars vs. Polski Koncern Naftowy |
| Asseco Business vs. Asseco Poland SA | Asseco Business vs. LSI Software SA | Asseco Business vs. Quantum Software 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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