Correlation Between Asbury Automotive and Dogwood Therapeutics,

Can any of the company-specific risk be diversified away by investing in both Asbury Automotive and Dogwood Therapeutics, 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 Asbury Automotive and Dogwood Therapeutics, into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Asbury Automotive Group and Dogwood Therapeutics,, you can compare the effects of market volatilities on Asbury Automotive and Dogwood Therapeutics, 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 Asbury Automotive with a short position of Dogwood Therapeutics,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asbury Automotive and Dogwood Therapeutics,.

Diversification Opportunities for Asbury Automotive and Dogwood Therapeutics,

-0.68

Correlation Coefficient

Asbury Automotive  Dogwood Therapeutics,

Excellent diversification

The 3 months correlation between Asbury and Dogwood is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Asbury Automotive Group and Dogwood Therapeutics, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dogwood Therapeutics, and Asbury Automotive 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 Asbury Automotive Group are associated (or correlated) with Dogwood Therapeutics,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dogwood Therapeutics, has no effect on the direction of Asbury Automotive i.e., Asbury Automotive and Dogwood Therapeutics, go up and down completely randomly.

Pair Corralation between Asbury Automotive and Dogwood Therapeutics,

Considering the 90-day investment horizon Asbury Automotive Group is expected to generate 0.26 times more return on investment than Dogwood Therapeutics,. However, Asbury Automotive Group is 3.82 times less risky than Dogwood Therapeutics,. It trades about -0.17 of its potential returns per unit of risk. Dogwood Therapeutics, is currently generating about -0.11 per unit of risk. If you would invest  25,816  in Asbury Automotive Group on September 22, 2024 and sell it today you would lose (1,239) from holding Asbury Automotive Group or give up 4.8% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Asbury Automotive Group  vs.  Dogwood Therapeutics,

Asbury Automotive

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Asbury Automotive Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent fundamental drivers, Asbury Automotive may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Dogwood Therapeutics,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dogwood Therapeutics, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Asbury Automotive and Dogwood Therapeutics,

The main advantage of trading using opposite Asbury Automotive and Dogwood Therapeutics, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asbury Automotive position performs unexpectedly, Dogwood Therapeutics, 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 Dogwood Therapeutics, will offset losses from the drop in Dogwood Therapeutics,'s long position.

The idea behind Asbury Automotive Group and Dogwood Therapeutics, 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.

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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.