Correlation Between COSTCO WHOLESALE and AEON STORES
Can any of the company-specific risk be diversified away by investing in both COSTCO WHOLESALE and AEON STORES 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 COSTCO WHOLESALE and AEON STORES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COSTCO WHOLESALE CDR and AEON STORES, you can compare the effects of market volatilities on COSTCO WHOLESALE and AEON STORES 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 COSTCO WHOLESALE with a short position of AEON STORES. Check out your portfolio center. Please also check ongoing floating volatility patterns of COSTCO WHOLESALE and AEON STORES.
Diversification Opportunities for COSTCO WHOLESALE and AEON STORES
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between COSTCO and AEON is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding COSTCO WHOLESALE CDR and AEON STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEON STORES and COSTCO WHOLESALE 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 COSTCO WHOLESALE CDR are associated (or correlated) with AEON STORES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEON STORES has no effect on the direction of COSTCO WHOLESALE i.e., COSTCO WHOLESALE and AEON STORES go up and down completely randomly.
Pair Corralation between COSTCO WHOLESALE and AEON STORES
If you would invest 2,660 in COSTCO WHOLESALE CDR on September 3, 2024 and sell it today you would earn a total of 300.00 from holding COSTCO WHOLESALE CDR or generate 11.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COSTCO WHOLESALE CDR vs. AEON STORES
Performance |
| Timeline |
| COSTCO WHOLESALE CDR |
| AEON STORES |
COSTCO WHOLESALE and AEON STORES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COSTCO WHOLESALE and AEON STORES
The main advantage of trading using opposite COSTCO WHOLESALE and AEON STORES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COSTCO WHOLESALE position performs unexpectedly, AEON STORES 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 AEON STORES will offset losses from the drop in AEON STORES's long position.| COSTCO WHOLESALE vs. Walmart | COSTCO WHOLESALE vs. Superior Plus Corp | COSTCO WHOLESALE vs. NMI Holdings | COSTCO WHOLESALE vs. Origin Agritech |
| AEON STORES vs. TOTAL GABON | AEON STORES vs. Walgreens Boots Alliance | AEON STORES vs. Peak Resources Limited |
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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