Correlation Between Automatic Bank and Infimer
Can any of the company-specific risk be diversified away by investing in both Automatic Bank and Infimer 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 Automatic Bank and Infimer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Automatic Bank Services and Infimer, you can compare the effects of market volatilities on Automatic Bank and Infimer 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 Automatic Bank with a short position of Infimer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Automatic Bank and Infimer.
Diversification Opportunities for Automatic Bank and Infimer
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Automatic and Infimer is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Automatic Bank Services and Infimer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infimer and Automatic Bank 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 Automatic Bank Services are associated (or correlated) with Infimer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infimer has no effect on the direction of Automatic Bank i.e., Automatic Bank and Infimer go up and down completely randomly.
Pair Corralation between Automatic Bank and Infimer
Assuming the 90 days trading horizon Automatic Bank is expected to generate 61.39 times less return on investment than Infimer. But when comparing it to its historical volatility, Automatic Bank Services is 58.24 times less risky than Infimer. It trades about 0.13 of its potential returns per unit of risk. Infimer is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 29,000 in Infimer on November 27, 2024 and sell it today you would earn a total of 1,075,000 from holding Infimer or generate 3706.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Automatic Bank Services vs. Infimer
Performance |
| Timeline |
| Automatic Bank Services |
| Infimer |
Automatic Bank and Infimer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Automatic Bank and Infimer
The main advantage of trading using opposite Automatic Bank and Infimer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Automatic Bank position performs unexpectedly, Infimer 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 Infimer will offset losses from the drop in Infimer's long position.The idea behind Automatic Bank Services and Infimer 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.| Infimer vs. IDI Insurance | Infimer vs. MediPress Health Limited Partnership | Infimer vs. Elron Electronic Industries | Infimer vs. Shagrir Group Vehicle |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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