Correlation Between Daifuku Co and Aumann AG
Can any of the company-specific risk be diversified away by investing in both Daifuku Co and Aumann AG 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 Daifuku Co and Aumann AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daifuku Co and Aumann AG, you can compare the effects of market volatilities on Daifuku Co and Aumann AG 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 Daifuku Co with a short position of Aumann AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daifuku Co and Aumann AG.
Diversification Opportunities for Daifuku Co and Aumann AG
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Daifuku and Aumann is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Daifuku Co and Aumann AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aumann AG and Daifuku Co 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 Daifuku Co are associated (or correlated) with Aumann AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aumann AG has no effect on the direction of Daifuku Co i.e., Daifuku Co and Aumann AG go up and down completely randomly.
Pair Corralation between Daifuku Co and Aumann AG
If you would invest 868.00 in Daifuku Co on August 25, 2024 and sell it today you would earn a total of 199.00 from holding Daifuku Co or generate 22.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daifuku Co vs. Aumann AG
Performance |
| Timeline |
| Daifuku Co |
| Aumann AG |
Daifuku Co and Aumann AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daifuku Co and Aumann AG
The main advantage of trading using opposite Daifuku Co and Aumann AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daifuku Co position performs unexpectedly, Aumann AG 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 Aumann AG will offset losses from the drop in Aumann AG's long position.| Daifuku Co vs. Aumann AG | Daifuku Co vs. Arista Power | Daifuku Co vs. Atlas Copco AB | Daifuku Co vs. American Commerce Solutions |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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