Correlation Between Event Hospitality and Ampol
Can any of the company-specific risk be diversified away by investing in both Event Hospitality and Ampol 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 Event Hospitality and Ampol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Event Hospitality and and Ampol, you can compare the effects of market volatilities on Event Hospitality and Ampol 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 Event Hospitality with a short position of Ampol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Event Hospitality and Ampol.
Diversification Opportunities for Event Hospitality and Ampol
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Event and Ampol is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Event Hospitality and and Ampol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ampol and Event Hospitality 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 Event Hospitality and are associated (or correlated) with Ampol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ampol has no effect on the direction of Event Hospitality i.e., Event Hospitality and Ampol go up and down completely randomly.
Pair Corralation between Event Hospitality and Ampol
Assuming the 90 days trading horizon Event Hospitality and is expected to generate 1.3 times more return on investment than Ampol. However, Event Hospitality is 1.3 times more volatile than Ampol. It trades about 0.02 of its potential returns per unit of risk. Ampol is currently generating about -0.03 per unit of risk. If you would invest 1,121 in Event Hospitality and on September 3, 2024 and sell it today you would earn a total of 55.00 from holding Event Hospitality and or generate 4.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Event Hospitality and vs. Ampol
Performance |
| Timeline |
| Event Hospitality |
| Ampol |
Event Hospitality and Ampol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Event Hospitality and Ampol
The main advantage of trading using opposite Event Hospitality and Ampol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Event Hospitality position performs unexpectedly, Ampol 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 Ampol will offset losses from the drop in Ampol's long position.| Event Hospitality vs. Encounter Resources | Event Hospitality vs. Tlou Energy | Event Hospitality vs. Superior Resources | Event Hospitality vs. Peel Mining |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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