Correlation Between Swiss Helvetia and Ashmore Group
Can any of the company-specific risk be diversified away by investing in both Swiss Helvetia and Ashmore Group 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 Swiss Helvetia and Ashmore Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swiss Helvetia Closed and Ashmore Group Plc, you can compare the effects of market volatilities on Swiss Helvetia and Ashmore 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 Swiss Helvetia with a short position of Ashmore Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiss Helvetia and Ashmore Group.
Diversification Opportunities for Swiss Helvetia and Ashmore Group
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Swiss and Ashmore is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Helvetia Closed and Ashmore Group Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashmore Group Plc and Swiss Helvetia 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 Swiss Helvetia Closed are associated (or correlated) with Ashmore Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashmore Group Plc has no effect on the direction of Swiss Helvetia i.e., Swiss Helvetia and Ashmore Group go up and down completely randomly.
Pair Corralation between Swiss Helvetia and Ashmore Group
Considering the 90-day investment horizon Swiss Helvetia is expected to generate 2.61 times less return on investment than Ashmore Group. But when comparing it to its historical volatility, Swiss Helvetia Closed is 7.49 times less risky than Ashmore Group. It trades about 0.05 of its potential returns per unit of risk. Ashmore Group Plc is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 275.00 in Ashmore Group Plc on October 20, 2024 and sell it today you would lose (90.00) from holding Ashmore Group Plc or give up 32.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 78.59% |
| Values | Daily Returns |
Swiss Helvetia Closed vs. Ashmore Group Plc
Performance |
| Timeline |
| Swiss Helvetia Closed |
| Ashmore Group Plc |
Swiss Helvetia and Ashmore Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swiss Helvetia and Ashmore Group
The main advantage of trading using opposite Swiss Helvetia and Ashmore Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swiss Helvetia position performs unexpectedly, Ashmore 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 Ashmore Group will offset losses from the drop in Ashmore Group's long position.| Swiss Helvetia vs. MFS High Yield | Swiss Helvetia vs. MFS High Income | Swiss Helvetia vs. MFS Multimarket Income | Swiss Helvetia vs. MFS Intermediate Income |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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