Correlation Between Shimano and ANTA Sports
Can any of the company-specific risk be diversified away by investing in both Shimano and ANTA Sports 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 Shimano and ANTA Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shimano Inc ADR and ANTA Sports Products, you can compare the effects of market volatilities on Shimano and ANTA Sports 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 Shimano with a short position of ANTA Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shimano and ANTA Sports.
Diversification Opportunities for Shimano and ANTA Sports
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shimano and ANTA is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Shimano Inc ADR and ANTA Sports Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA Sports Products and Shimano 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 Shimano Inc ADR are associated (or correlated) with ANTA Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA Sports Products has no effect on the direction of Shimano i.e., Shimano and ANTA Sports go up and down completely randomly.
Pair Corralation between Shimano and ANTA Sports
Assuming the 90 days horizon Shimano is expected to generate 775.11 times less return on investment than ANTA Sports. But when comparing it to its historical volatility, Shimano Inc ADR is 1.5 times less risky than ANTA Sports. It trades about 0.0 of its potential returns per unit of risk. ANTA Sports Products is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 992.00 in ANTA Sports Products on November 18, 2024 and sell it today you would earn a total of 148.00 from holding ANTA Sports Products or generate 14.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shimano Inc ADR vs. ANTA Sports Products
Performance |
| Timeline |
| Shimano Inc ADR |
| ANTA Sports Products |
Shimano and ANTA Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shimano and ANTA Sports
The main advantage of trading using opposite Shimano and ANTA Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shimano position performs unexpectedly, ANTA Sports 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 ANTA Sports will offset losses from the drop in ANTA Sports' long position.| Shimano vs. Callaway Golf | Shimano vs. Peloton Interactive | Shimano vs. BANDAI NAMCO Holdings | Shimano vs. Nikon Corp |
| ANTA Sports vs. ANTA Sports Products | ANTA Sports vs. Li Ning Company | ANTA Sports vs. Li Ning Co | ANTA Sports vs. Anhui Conch Cement |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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