Correlation Between Este Lauder and AT S
Can any of the company-specific risk be diversified away by investing in both Este Lauder and AT S 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 Este Lauder and AT S into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Este Lauder and AT S Austria, you can compare the effects of market volatilities on Este Lauder and AT S 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 Este Lauder with a short position of AT S. Check out your portfolio center. Please also check ongoing floating volatility patterns of Este Lauder and AT S.
Diversification Opportunities for Este Lauder and AT S
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Este and ATS is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding The Este Lauder and AT S Austria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AT S Austria and Este Lauder 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 The Este Lauder are associated (or correlated) with AT S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AT S Austria has no effect on the direction of Este Lauder i.e., Este Lauder and AT S go up and down completely randomly.
Pair Corralation between Este Lauder and AT S
Assuming the 90 days trading horizon The Este Lauder is expected to generate 1.66 times more return on investment than AT S. However, Este Lauder is 1.66 times more volatile than AT S Austria. It trades about -0.12 of its potential returns per unit of risk. AT S Austria is currently generating about -0.52 per unit of risk. If you would invest 8,160 in The Este Lauder on August 29, 2024 and sell it today you would lose (1,260) from holding The Este Lauder or give up 15.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Este Lauder vs. AT S Austria
Performance |
| Timeline |
| Este Lauder |
| AT S Austria |
Este Lauder and AT S Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Este Lauder and AT S
The main advantage of trading using opposite Este Lauder and AT S positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Este Lauder position performs unexpectedly, AT S 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 AT S will offset losses from the drop in AT S's long position.| Este Lauder vs. Unilever PLC | Este Lauder vs. RATH Aktiengesellschaft | Este Lauder vs. AT S Austria | Este Lauder vs. BAWAG Group AG |
| AT S vs. Voestalpine AG | AT S vs. Lenzing Aktiengesellschaft | AT S vs. Andritz AG | AT S vs. OMV Aktiengesellschaft |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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