Correlation Between Carsales and LEWAG HOLDING
Can any of the company-specific risk be diversified away by investing in both Carsales and LEWAG HOLDING 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 LEWAG HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CarsalesCom and LEWAG HOLDING AG, you can compare the effects of market volatilities on Carsales and LEWAG HOLDING 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 LEWAG HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carsales and LEWAG HOLDING.
Diversification Opportunities for Carsales and LEWAG HOLDING
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Carsales and LEWAG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CarsalesCom and LEWAG HOLDING AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LEWAG HOLDING AG 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 LEWAG HOLDING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LEWAG HOLDING AG has no effect on the direction of Carsales i.e., Carsales and LEWAG HOLDING go up and down completely randomly.
Pair Corralation between Carsales and LEWAG HOLDING
If you would invest 2,220 in CarsalesCom on October 24, 2024 and sell it today you would earn a total of 60.00 from holding CarsalesCom or generate 2.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.88% |
| Values | Daily Returns |
CarsalesCom vs. LEWAG HOLDING AG
Performance |
| Timeline |
| CarsalesCom |
| LEWAG HOLDING AG |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Carsales and LEWAG HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carsales and LEWAG HOLDING
The main advantage of trading using opposite Carsales and LEWAG HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carsales position performs unexpectedly, LEWAG HOLDING 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 LEWAG HOLDING will offset losses from the drop in LEWAG HOLDING's long position.| Carsales vs. Corporate Office Properties | Carsales vs. DATATEC LTD 2 | Carsales vs. Cass Information Systems | Carsales vs. Information Services International Dentsu |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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