Correlation Between ASTRAZENECA and 00108WAF7
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By analyzing existing cross correlation between ASTRAZENECA PLC and AEP TEX INC, you can compare the effects of market volatilities on ASTRAZENECA and 00108WAF7 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 ASTRAZENECA with a short position of 00108WAF7. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASTRAZENECA and 00108WAF7.
Diversification Opportunities for ASTRAZENECA and 00108WAF7
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between ASTRAZENECA and 00108WAF7 is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding ASTRAZENECA PLC and AEP TEX INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEP TEX INC and ASTRAZENECA 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 ASTRAZENECA PLC are associated (or correlated) with 00108WAF7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEP TEX INC has no effect on the direction of ASTRAZENECA i.e., ASTRAZENECA and 00108WAF7 go up and down completely randomly.
Pair Corralation between ASTRAZENECA and 00108WAF7
Assuming the 90 days trading horizon ASTRAZENECA is expected to generate 1957.83 times less return on investment than 00108WAF7. But when comparing it to its historical volatility, ASTRAZENECA PLC is 480.11 times less risky than 00108WAF7. It trades about 0.03 of its potential returns per unit of risk. AEP TEX INC is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 7,765 in AEP TEX INC on September 2, 2024 and sell it today you would lose (97.00) from holding AEP TEX INC or give up 1.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 63.56% |
| Values | Daily Returns |
ASTRAZENECA PLC vs. AEP TEX INC
Performance |
| Timeline |
| ASTRAZENECA PLC |
| AEP TEX INC |
ASTRAZENECA and 00108WAF7 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASTRAZENECA and 00108WAF7
The main advantage of trading using opposite ASTRAZENECA and 00108WAF7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASTRAZENECA position performs unexpectedly, 00108WAF7 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 00108WAF7 will offset losses from the drop in 00108WAF7's long position.| ASTRAZENECA vs. AEP TEX INC | ASTRAZENECA vs. US BANK NATIONAL | ASTRAZENECA vs. Bank of America | ASTRAZENECA vs. GE Aerospace |
| 00108WAF7 vs. Zhihu Inc ADR | 00108WAF7 vs. Playtika Holding Corp | 00108WAF7 vs. Thor Industries | 00108WAF7 vs. Dana Inc |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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