Correlation Between Centrex Metals and Ashley Services
Can any of the company-specific risk be diversified away by investing in both Centrex Metals and Ashley Services 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 Centrex Metals and Ashley Services into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centrex Metals and Ashley Services Group, you can compare the effects of market volatilities on Centrex Metals and Ashley Services 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 Centrex Metals with a short position of Ashley Services. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centrex Metals and Ashley Services.
Diversification Opportunities for Centrex Metals and Ashley Services
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Centrex and Ashley is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Centrex Metals and Ashley Services Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashley Services Group and Centrex Metals 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 Centrex Metals are associated (or correlated) with Ashley Services. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashley Services Group has no effect on the direction of Centrex Metals i.e., Centrex Metals and Ashley Services go up and down completely randomly.
Pair Corralation between Centrex Metals and Ashley Services
Assuming the 90 days trading horizon Centrex Metals is expected to under-perform the Ashley Services. But the stock apears to be less risky and, when comparing its historical volatility, Centrex Metals is 1.17 times less risky than Ashley Services. The stock trades about -0.23 of its potential returns per unit of risk. The Ashley Services Group is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Ashley Services Group on October 25, 2024 and sell it today you would earn a total of 1.00 from holding Ashley Services Group or generate 5.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Centrex Metals vs. Ashley Services Group
Performance |
| Timeline |
| Centrex Metals |
| Ashley Services Group |
Centrex Metals and Ashley Services Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centrex Metals and Ashley Services
The main advantage of trading using opposite Centrex Metals and Ashley Services positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centrex Metals position performs unexpectedly, Ashley Services 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 Ashley Services will offset losses from the drop in Ashley Services' long position.| Centrex Metals vs. Centaurus Metals | Centrex Metals vs. Aristocrat Leisure | Centrex Metals vs. Ainsworth Game Technology | Centrex Metals vs. Navigator Global Investments |
| Ashley Services vs. Mach7 Technologies | Ashley Services vs. Macquarie Technology Group | Ashley Services vs. High Tech Metals | Ashley Services vs. Pure Foods Tasmania |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |