Correlation Between GATX and AZN Capital
Can any of the company-specific risk be diversified away by investing in both GATX and AZN Capital 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 GATX and AZN Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GATX Corporation and AZN Capital Corp, you can compare the effects of market volatilities on GATX and AZN Capital 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 GATX with a short position of AZN Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of GATX and AZN Capital.
Diversification Opportunities for GATX and AZN Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GATX and AZN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GATX Corp. and AZN Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AZN Capital Corp and GATX 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 GATX Corporation are associated (or correlated) with AZN Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AZN Capital Corp has no effect on the direction of GATX i.e., GATX and AZN Capital go up and down completely randomly.
Pair Corralation between GATX and AZN Capital
If you would invest 13,776 in GATX Corporation on September 1, 2024 and sell it today you would earn a total of 2,640 from holding GATX Corporation or generate 19.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GATX Corp. vs. AZN Capital Corp
Performance |
| Timeline |
| GATX |
| AZN Capital Corp |
GATX and AZN Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GATX and AZN Capital
The main advantage of trading using opposite GATX and AZN Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GATX position performs unexpectedly, AZN Capital 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 AZN Capital will offset losses from the drop in AZN Capital's long position.The idea behind GATX Corporation and AZN Capital Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| AZN Capital vs. United Rentals | AZN Capital vs. Ashtead Gro | AZN Capital vs. Ashtead Group plc | AZN Capital vs. AerCap Holdings NV |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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