Correlation Between Fernhill Beverage and Asbury Automotive
Can any of the company-specific risk be diversified away by investing in both Fernhill Beverage and Asbury Automotive 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 Fernhill Beverage and Asbury Automotive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fernhill Beverage and Asbury Automotive Group, you can compare the effects of market volatilities on Fernhill Beverage and Asbury Automotive 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 Fernhill Beverage with a short position of Asbury Automotive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fernhill Beverage and Asbury Automotive.
Diversification Opportunities for Fernhill Beverage and Asbury Automotive
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fernhill and Asbury is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fernhill Beverage and Asbury Automotive Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asbury Automotive and Fernhill Beverage 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 Fernhill Beverage are associated (or correlated) with Asbury Automotive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asbury Automotive has no effect on the direction of Fernhill Beverage i.e., Fernhill Beverage and Asbury Automotive go up and down completely randomly.
Pair Corralation between Fernhill Beverage and Asbury Automotive
If you would invest 0.01 in Fernhill Beverage on September 15, 2024 and sell it today you would earn a total of 0.00 from holding Fernhill Beverage or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fernhill Beverage vs. Asbury Automotive Group
Performance |
| Timeline |
| Fernhill Beverage |
| Asbury Automotive |
Fernhill Beverage and Asbury Automotive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fernhill Beverage and Asbury Automotive
The main advantage of trading using opposite Fernhill Beverage and Asbury Automotive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fernhill Beverage position performs unexpectedly, Asbury Automotive 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 Asbury Automotive will offset losses from the drop in Asbury Automotive's long position.| Fernhill Beverage vs. National Beverage Corp | Fernhill Beverage vs. Celsius Holdings | Fernhill Beverage vs. Monster Beverage Corp | Fernhill Beverage vs. Coca Cola Femsa SAB |
| Asbury Automotive vs. AutoNation | Asbury Automotive vs. OReilly Automotive | Asbury Automotive vs. Advance Auto Parts | Asbury Automotive vs. Ross Stores |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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