Correlation Between Telekom Austria and Anheuser Busch
Can any of the company-specific risk be diversified away by investing in both Telekom Austria and Anheuser Busch 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 Telekom Austria and Anheuser Busch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telekom Austria AG and Anheuser Busch InBev SANV, you can compare the effects of market volatilities on Telekom Austria and Anheuser Busch 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 Telekom Austria with a short position of Anheuser Busch. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telekom Austria and Anheuser Busch.
Diversification Opportunities for Telekom Austria and Anheuser Busch
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Telekom and Anheuser is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Telekom Austria AG and Anheuser Busch InBev SANV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anheuser Busch InBev and Telekom Austria 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 Telekom Austria AG are associated (or correlated) with Anheuser Busch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anheuser Busch InBev has no effect on the direction of Telekom Austria i.e., Telekom Austria and Anheuser Busch go up and down completely randomly.
Pair Corralation between Telekom Austria and Anheuser Busch
Assuming the 90 days trading horizon Telekom Austria AG is expected to generate 0.81 times more return on investment than Anheuser Busch. However, Telekom Austria AG is 1.24 times less risky than Anheuser Busch. It trades about 0.02 of its potential returns per unit of risk. Anheuser Busch InBev SANV is currently generating about -0.02 per unit of risk. If you would invest 737.00 in Telekom Austria AG on August 27, 2024 and sell it today you would earn a total of 40.00 from holding Telekom Austria AG or generate 5.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telekom Austria AG vs. Anheuser Busch InBev SANV
Performance |
| Timeline |
| Telekom Austria AG |
| Anheuser Busch InBev |
Telekom Austria and Anheuser Busch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telekom Austria and Anheuser Busch
The main advantage of trading using opposite Telekom Austria and Anheuser Busch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telekom Austria position performs unexpectedly, Anheuser Busch 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 Anheuser Busch will offset losses from the drop in Anheuser Busch's long position.| Telekom Austria vs. Voestalpine AG | Telekom Austria vs. Oesterr Post AG | Telekom Austria vs. Wienerberger AG | Telekom Austria vs. VERBUND AG |
| Anheuser Busch vs. RATH Aktiengesellschaft | Anheuser Busch vs. Semperit Aktiengesellschaft Holding | Anheuser Busch vs. Oesterr Post AG | Anheuser Busch vs. Voestalpine AG |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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