Correlation Between Carsales and De Grey

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Carsales and De Grey 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 Carsales and De Grey into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CarsalesCom and De Grey Mining, you can compare the effects of market volatilities on Carsales and De Grey 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 Carsales with a short position of De Grey. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carsales and De Grey.

Diversification Opportunities for Carsales and De Grey

0.22
  Correlation Coefficient

Modest diversification

The 3 months correlation between Carsales and DGD is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding CarsalesCom and De Grey Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on De Grey Mining and Carsales 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 CarsalesCom are associated (or correlated) with De Grey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of De Grey Mining has no effect on the direction of Carsales i.e., Carsales and De Grey go up and down completely randomly.

Pair Corralation between Carsales and De Grey

Assuming the 90 days horizon CarsalesCom is expected to generate 0.49 times more return on investment than De Grey. However, CarsalesCom is 2.06 times less risky than De Grey. It trades about 0.08 of its potential returns per unit of risk. De Grey Mining is currently generating about 0.02 per unit of risk. If you would invest  1,310  in CarsalesCom on October 11, 2024 and sell it today you would earn a total of  910.00  from holding CarsalesCom or generate 69.47% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

CarsalesCom  vs.  De Grey Mining

 Performance 
       Timeline  
CarsalesCom 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days CarsalesCom has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Carsales is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
De Grey Mining 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in De Grey Mining are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, De Grey unveiled solid returns over the last few months and may actually be approaching a breakup point.

Carsales and De Grey Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Carsales and De Grey

The main advantage of trading using opposite Carsales and De Grey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carsales position performs unexpectedly, De Grey 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 De Grey will offset losses from the drop in De Grey's long position.
Carsales vs. FLOW TRADERS LTD
Carsales vs. Retail Estates NV
Carsales vs. National Retail Properties
Carsales vs. H2O Retailing
The idea behind CarsalesCom and De Grey Mining 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.
De Grey vs. CarsalesCom
De Grey vs. KENEDIX OFFICE INV
De Grey vs. ADRIATIC METALS LS 013355
De Grey vs. ARDAGH METAL PACDL 0001
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.

Other Complementary Tools

Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Equity Analysis
Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.


 
Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions
 
Feedback Blog
Made with optimal in San Francisco
2024 Macroaxis LLC
COMMON DESTINATIONS
MAIN CATEGORIES
COMPANY