Correlation Between Sixt SE and Ashtead Group
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By analyzing existing cross correlation between Sixt SE and Ashtead Group plc, you can compare the effects of market volatilities on Sixt SE and Ashtead Group 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 Sixt SE with a short position of Ashtead Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixt SE and Ashtead Group.
Diversification Opportunities for Sixt SE and Ashtead Group
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sixt and Ashtead is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Sixt SE and Ashtead Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashtead Group plc and Sixt SE 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 Sixt SE are associated (or correlated) with Ashtead Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashtead Group plc has no effect on the direction of Sixt SE i.e., Sixt SE and Ashtead Group go up and down completely randomly.
Pair Corralation between Sixt SE and Ashtead Group
Assuming the 90 days trading horizon Sixt SE is expected to under-perform the Ashtead Group. But the stock apears to be less risky and, when comparing its historical volatility, Sixt SE is 1.19 times less risky than Ashtead Group. The stock trades about -0.02 of its potential returns per unit of risk. The Ashtead Group plc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 5,697 in Ashtead Group plc on September 4, 2024 and sell it today you would earn a total of 1,853 from holding Ashtead Group plc or generate 32.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sixt SE vs. Ashtead Group plc
Performance |
| Timeline |
| Sixt SE |
| Ashtead Group plc |
Sixt SE and Ashtead Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sixt SE and Ashtead Group
The main advantage of trading using opposite Sixt SE and Ashtead Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sixt SE position performs unexpectedly, Ashtead Group 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 Group will offset losses from the drop in Ashtead Group's long position.The idea behind Sixt SE and Ashtead Group plc 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.| Ashtead Group vs. WT OFFSHORE | Ashtead Group vs. SOLSTAD OFFSHORE NK | Ashtead Group vs. DXC Technology Co | Ashtead Group vs. X FAB Silicon Foundries |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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