Correlation Between Textainer Group and Aarons
Can any of the company-specific risk be diversified away by investing in both Textainer Group and Aarons 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 Textainer Group and Aarons into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Textainer Group Holdings and The Aarons, you can compare the effects of market volatilities on Textainer Group and Aarons 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 Textainer Group with a short position of Aarons. Check out your portfolio center. Please also check ongoing floating volatility patterns of Textainer Group and Aarons.
Diversification Opportunities for Textainer Group and Aarons
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Textainer and Aarons is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Textainer Group Holdings and The Aarons in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aarons and Textainer 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 Textainer Group Holdings are associated (or correlated) with Aarons. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aarons has no effect on the direction of Textainer Group i.e., Textainer Group and Aarons go up and down completely randomly.
Pair Corralation between Textainer Group and Aarons
If you would invest 1,009 in The Aarons on September 18, 2024 and sell it today you would earn a total of 0.00 from holding The Aarons or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Textainer Group Holdings vs. The Aarons
Performance |
Timeline |
Textainer Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Aarons |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Textainer Group and Aarons Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Textainer Group and Aarons
The main advantage of trading using opposite Textainer Group and Aarons positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Textainer Group position performs unexpectedly, Aarons 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 Aarons will offset losses from the drop in Aarons' long position.Textainer Group vs. Ryder System | Textainer Group vs. Triton International Limited | Textainer Group vs. Air Lease | Textainer Group vs. Herc Holdings |
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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 Stocks Directory module to find actively traded stocks across global markets.
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