Correlation Between 00108WAF7 and GRAINGER
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By analyzing existing cross correlation between AEP TEX INC and GRAINGER W W, you can compare the effects of market volatilities on 00108WAF7 and GRAINGER 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 00108WAF7 with a short position of GRAINGER. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00108WAF7 and GRAINGER.
Diversification Opportunities for 00108WAF7 and GRAINGER
Good diversification
The 3 months correlation between 00108WAF7 and GRAINGER is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding AEP TEX INC and GRAINGER W W in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRAINGER W W and 00108WAF7 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 AEP TEX INC are associated (or correlated) with GRAINGER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRAINGER W W has no effect on the direction of 00108WAF7 i.e., 00108WAF7 and GRAINGER go up and down completely randomly.
Pair Corralation between 00108WAF7 and GRAINGER
Assuming the 90 days trading horizon 00108WAF7 is expected to generate 1.69 times less return on investment than GRAINGER. In addition to that, 00108WAF7 is 2.09 times more volatile than GRAINGER W W. It trades about 0.11 of its total potential returns per unit of risk. GRAINGER W W is currently generating about 0.4 per unit of volatility. If you would invest 8,504 in GRAINGER W W on September 2, 2024 and sell it today you would earn a total of 348.00 from holding GRAINGER W W or generate 4.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 50.0% |
| Values | Daily Returns |
AEP TEX INC vs. GRAINGER W W
Performance |
| Timeline |
| AEP TEX INC |
| GRAINGER W W |
00108WAF7 and GRAINGER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 00108WAF7 and GRAINGER
The main advantage of trading using opposite 00108WAF7 and GRAINGER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00108WAF7 position performs unexpectedly, GRAINGER 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 GRAINGER will offset losses from the drop in GRAINGER's long position.| 00108WAF7 vs. Zhihu Inc ADR | 00108WAF7 vs. Playtika Holding Corp | 00108WAF7 vs. Thor Industries | 00108WAF7 vs. Dana Inc |
| GRAINGER vs. Cracker Barrel Old | GRAINGER vs. Westrock Coffee | GRAINGER vs. RCI Hospitality Holdings | GRAINGER vs. CAVA Group, |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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