Correlation Between RTL Group and Aferian Plc
Can any of the company-specific risk be diversified away by investing in both RTL Group and Aferian Plc 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 RTL Group and Aferian Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RTL Group SA and Aferian Plc, you can compare the effects of market volatilities on RTL Group and Aferian Plc 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 RTL Group with a short position of Aferian Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of RTL Group and Aferian Plc.
Diversification Opportunities for RTL Group and Aferian Plc
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between RTL and Aferian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding RTL Group SA and Aferian Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aferian Plc and RTL Group 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 RTL Group SA are associated (or correlated) with Aferian Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aferian Plc has no effect on the direction of RTL Group i.e., RTL Group and Aferian Plc go up and down completely randomly.
Pair Corralation between RTL Group and Aferian Plc
If you would invest 4,288 in RTL Group SA on August 27, 2024 and sell it today you would earn a total of 0.00 from holding RTL Group SA 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 |
RTL Group SA vs. Aferian Plc
Performance |
| Timeline |
| RTL Group SA |
| Aferian Plc |
RTL Group and Aferian Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RTL Group and Aferian Plc
The main advantage of trading using opposite RTL Group and Aferian Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RTL Group position performs unexpectedly, Aferian Plc 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 Aferian Plc will offset losses from the drop in Aferian Plc's long position.| RTL Group vs. Copa Holdings SA | RTL Group vs. United Airlines Holdings | RTL Group vs. Delta Air Lines | RTL Group vs. SkyWest |
| Aferian Plc vs. Copa Holdings SA | Aferian Plc vs. United Airlines Holdings | Aferian Plc vs. Delta Air Lines | Aferian Plc vs. SkyWest |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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