Correlation Between Tsingtao Brewery and Asahi Group
Can any of the company-specific risk be diversified away by investing in both Tsingtao Brewery and Asahi 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 Tsingtao Brewery and Asahi Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tsingtao Brewery and Asahi Group Holdings, you can compare the effects of market volatilities on Tsingtao Brewery and Asahi 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 Tsingtao Brewery with a short position of Asahi Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tsingtao Brewery and Asahi Group.
Diversification Opportunities for Tsingtao Brewery and Asahi Group
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tsingtao and Asahi is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Tsingtao Brewery and Asahi Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asahi Group Holdings and Tsingtao Brewery 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 Tsingtao Brewery are associated (or correlated) with Asahi Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asahi Group Holdings has no effect on the direction of Tsingtao Brewery i.e., Tsingtao Brewery and Asahi Group go up and down completely randomly.
Pair Corralation between Tsingtao Brewery and Asahi Group
Assuming the 90 days horizon Tsingtao Brewery is expected to generate 2.12 times more return on investment than Asahi Group. However, Tsingtao Brewery is 2.12 times more volatile than Asahi Group Holdings. It trades about 0.03 of its potential returns per unit of risk. Asahi Group Holdings is currently generating about 0.01 per unit of risk. If you would invest 480.00 in Tsingtao Brewery on September 4, 2024 and sell it today you would earn a total of 126.00 from holding Tsingtao Brewery or generate 26.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tsingtao Brewery vs. Asahi Group Holdings
Performance |
| Timeline |
| Tsingtao Brewery |
| Asahi Group Holdings |
Tsingtao Brewery and Asahi Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tsingtao Brewery and Asahi Group
The main advantage of trading using opposite Tsingtao Brewery and Asahi Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tsingtao Brewery position performs unexpectedly, Asahi 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 Asahi Group will offset losses from the drop in Asahi Group's long position.The idea behind Tsingtao Brewery and Asahi Group Holdings 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.| Asahi Group vs. Uber Technologies | Asahi Group vs. THORNEY TECHS LTD | Asahi Group vs. Digilife Technologies Limited | Asahi Group vs. Virtus Investment Partners |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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