Correlation Between Aegon NV and Mills Music
Can any of the company-specific risk be diversified away by investing in both Aegon NV and Mills Music 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 Aegon NV and Mills Music into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegon NV ADR and Mills Music Trust, you can compare the effects of market volatilities on Aegon NV and Mills Music 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 Aegon NV with a short position of Mills Music. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegon NV and Mills Music.
Diversification Opportunities for Aegon NV and Mills Music
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aegon and Mills is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Aegon NV ADR and Mills Music Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mills Music Trust and Aegon NV 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 Aegon NV ADR are associated (or correlated) with Mills Music. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mills Music Trust has no effect on the direction of Aegon NV i.e., Aegon NV and Mills Music go up and down completely randomly.
Pair Corralation between Aegon NV and Mills Music
Considering the 90-day investment horizon Aegon NV ADR is expected to generate 0.98 times more return on investment than Mills Music. However, Aegon NV ADR is 1.02 times less risky than Mills Music. It trades about 0.0 of its potential returns per unit of risk. Mills Music Trust is currently generating about -0.24 per unit of risk. If you would invest 634.00 in Aegon NV ADR on December 2, 2024 and sell it today you would lose (6.00) from holding Aegon NV ADR or give up 0.95% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Aegon NV ADR vs. Mills Music Trust
Performance |
Timeline |
Aegon NV ADR |
Mills Music Trust |
Aegon NV and Mills Music Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aegon NV and Mills Music
The main advantage of trading using opposite Aegon NV and Mills Music positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegon NV position performs unexpectedly, Mills Music 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 Mills Music will offset losses from the drop in Mills Music's long position.Aegon NV vs. Hartford Financial Services | Aegon NV vs. Goosehead Insurance | Aegon NV vs. International General Insurance | Aegon NV vs. Enstar Group Limited |
Mills Music vs. Citrine Global Corp | Mills Music vs. Blue Water Ventures | Mills Music vs. DATA Communications Management | Mills Music vs. Aramark Holdings |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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