Correlation Between Multi Ways and Ashtead Gro
Can any of the company-specific risk be diversified away by investing in both Multi Ways and Ashtead Gro 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 Multi Ways and Ashtead Gro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multi Ways Holdings and Ashtead Gro, you can compare the effects of market volatilities on Multi Ways and Ashtead Gro 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 Multi Ways with a short position of Ashtead Gro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi Ways and Ashtead Gro.
Diversification Opportunities for Multi Ways and Ashtead Gro
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Multi and Ashtead is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Multi Ways Holdings and Ashtead Gro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashtead Gro and Multi Ways 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 Multi Ways Holdings are associated (or correlated) with Ashtead Gro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashtead Gro has no effect on the direction of Multi Ways i.e., Multi Ways and Ashtead Gro go up and down completely randomly.
Pair Corralation between Multi Ways and Ashtead Gro
Considering the 90-day investment horizon Multi Ways Holdings is expected to under-perform the Ashtead Gro. In addition to that, Multi Ways is 2.44 times more volatile than Ashtead Gro. It trades about -0.02 of its total potential returns per unit of risk. Ashtead Gro is currently generating about 0.18 per unit of volatility. If you would invest 30,551 in Ashtead Gro on August 30, 2024 and sell it today you would earn a total of 2,032 from holding Ashtead Gro or generate 6.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multi Ways Holdings vs. Ashtead Gro
Performance |
| Timeline |
| Multi Ways Holdings |
| Ashtead Gro |
Multi Ways and Ashtead Gro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi Ways and Ashtead Gro
The main advantage of trading using opposite Multi Ways and Ashtead Gro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi Ways position performs unexpectedly, Ashtead Gro 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 Ashtead Gro will offset losses from the drop in Ashtead Gro's long position.| Multi Ways vs. FlexShopper | Multi Ways vs. Hertz Global Holdings | Multi Ways vs. HyreCar | Multi Ways vs. Avis Budget Group |
| Ashtead Gro vs. United Rentals | Ashtead Gro vs. Ashtead Group plc | Ashtead Gro vs. AerCap Holdings NV | Ashtead Gro vs. Fortress Transp Infra |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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