Correlation Between ANT and Smart Concrete

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

Diversification Opportunities for ANT and Smart Concrete

0.23
  Correlation Coefficient

Modest diversification

The 3 months correlation between ANT and Smart is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding ANT and Smart Concrete Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smart Concrete Public and ANT 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 ANT are associated (or correlated) with Smart Concrete. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smart Concrete Public has no effect on the direction of ANT i.e., ANT and Smart Concrete go up and down completely randomly.

Pair Corralation between ANT and Smart Concrete

Assuming the 90 days trading horizon ANT is expected to generate 1.27 times more return on investment than Smart Concrete. However, ANT is 1.27 times more volatile than Smart Concrete Public. It trades about 0.1 of its potential returns per unit of risk. Smart Concrete Public is currently generating about 0.04 per unit of risk. If you would invest  314.00  in ANT on October 24, 2024 and sell it today you would lose (167.00) from holding ANT or give up 53.18% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy61.88%
ValuesDaily Returns

ANT  vs.  Smart Concrete Public

 Performance 
       Timeline  
ANT 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in ANT are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, ANT exhibited solid returns over the last few months and may actually be approaching a breakup point.
Smart Concrete Public 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Smart Concrete Public are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental drivers, Smart Concrete may actually be approaching a critical reversion point that can send shares even higher in February 2025.

ANT and Smart Concrete Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with ANT and Smart Concrete

The main advantage of trading using opposite ANT and Smart Concrete positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANT position performs unexpectedly, Smart Concrete 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 Smart Concrete will offset losses from the drop in Smart Concrete's long position.
The idea behind ANT and Smart Concrete Public 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.
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.

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