Correlation Between Consumer Automotive and D’Ieteren
Can any of the company-specific risk be diversified away by investing in both Consumer Automotive and D’Ieteren 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 Consumer Automotive and D’Ieteren into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Consumer Automotive Finance and DIeteren NV ADR, you can compare the effects of market volatilities on Consumer Automotive and D’Ieteren 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 Consumer Automotive with a short position of D’Ieteren. Check out your portfolio center. Please also check ongoing floating volatility patterns of Consumer Automotive and D’Ieteren.
Diversification Opportunities for Consumer Automotive and D’Ieteren
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Consumer and D’Ieteren is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Consumer Automotive Finance and DIeteren NV ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DIeteren NV ADR and Consumer Automotive 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 Consumer Automotive Finance are associated (or correlated) with D’Ieteren. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DIeteren NV ADR has no effect on the direction of Consumer Automotive i.e., Consumer Automotive and D’Ieteren go up and down completely randomly.
Pair Corralation between Consumer Automotive and D’Ieteren
If you would invest 8,626 in DIeteren NV ADR on September 4, 2024 and sell it today you would earn a total of 2,178 from holding DIeteren NV ADR or generate 25.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 78.63% |
| Values | Daily Returns |
Consumer Automotive Finance vs. DIeteren NV ADR
Performance |
| Timeline |
| Consumer Automotive |
| DIeteren NV ADR |
Consumer Automotive and D’Ieteren Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Consumer Automotive and D’Ieteren
The main advantage of trading using opposite Consumer Automotive and D’Ieteren positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Consumer Automotive position performs unexpectedly, D’Ieteren 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 D’Ieteren will offset losses from the drop in D’Ieteren's long position.| Consumer Automotive vs. Grand Baoxin Auto | Consumer Automotive vs. AutoCanada | Consumer Automotive vs. Kaixin Auto Holdings | Consumer Automotive vs. Vroom Inc |
| D’Ieteren vs. Consumer Automotive Finance | D’Ieteren vs. Vroom Inc | D’Ieteren vs. AutoCanada | D’Ieteren vs. Kaixin Auto Holdings |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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