Correlation Between Aozora Bank and Isetan Mitsukoshi
Can any of the company-specific risk be diversified away by investing in both Aozora Bank and Isetan Mitsukoshi 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 Aozora Bank and Isetan Mitsukoshi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aozora Bank and Isetan Mitsukoshi Holdings, you can compare the effects of market volatilities on Aozora Bank and Isetan Mitsukoshi 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 Aozora Bank with a short position of Isetan Mitsukoshi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aozora Bank and Isetan Mitsukoshi.
Diversification Opportunities for Aozora Bank and Isetan Mitsukoshi
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aozora and Isetan is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Aozora Bank and Isetan Mitsukoshi Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Isetan Mitsukoshi and Aozora Bank 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 Aozora Bank are associated (or correlated) with Isetan Mitsukoshi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Isetan Mitsukoshi has no effect on the direction of Aozora Bank i.e., Aozora Bank and Isetan Mitsukoshi go up and down completely randomly.
Pair Corralation between Aozora Bank and Isetan Mitsukoshi
Assuming the 90 days horizon Aozora Bank is expected to under-perform the Isetan Mitsukoshi. But the stock apears to be less risky and, when comparing its historical volatility, Aozora Bank is 1.62 times less risky than Isetan Mitsukoshi. The stock trades about -0.02 of its potential returns per unit of risk. The Isetan Mitsukoshi Holdings is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 1,330 in Isetan Mitsukoshi Holdings on September 25, 2024 and sell it today you would earn a total of 150.00 from holding Isetan Mitsukoshi Holdings or generate 11.28% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Aozora Bank vs. Isetan Mitsukoshi Holdings
Performance |
Timeline |
Aozora Bank |
Isetan Mitsukoshi |
Aozora Bank and Isetan Mitsukoshi Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aozora Bank and Isetan Mitsukoshi
The main advantage of trading using opposite Aozora Bank and Isetan Mitsukoshi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aozora Bank position performs unexpectedly, Isetan Mitsukoshi 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 Isetan Mitsukoshi will offset losses from the drop in Isetan Mitsukoshi's long position.Aozora Bank vs. Wells Fargo | Aozora Bank vs. China Construction Bank | Aozora Bank vs. HSBC Holdings plc | Aozora Bank vs. HSBC Holdings plc |
Isetan Mitsukoshi vs. Sumitomo Rubber Industries | Isetan Mitsukoshi vs. Aozora Bank | Isetan Mitsukoshi vs. Ameriprise Financial | Isetan Mitsukoshi vs. Materialise NV |
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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
Money Managers Screen money managers from public funds and ETFs managed around the world | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |