Correlation Between Aston Martin and SCOR PK

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Aston Martin and SCOR PK 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 Aston Martin and SCOR PK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aston Martin Lagonda and SCOR PK, you can compare the effects of market volatilities on Aston Martin and SCOR PK 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 Aston Martin with a short position of SCOR PK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aston Martin and SCOR PK.

Diversification Opportunities for Aston Martin and SCOR PK

-0.67
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Aston and SCOR is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Aston Martin Lagonda and SCOR PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCOR PK and Aston Martin 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 Aston Martin Lagonda are associated (or correlated) with SCOR PK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCOR PK has no effect on the direction of Aston Martin i.e., Aston Martin and SCOR PK go up and down completely randomly.

Pair Corralation between Aston Martin and SCOR PK

Assuming the 90 days horizon Aston Martin Lagonda is expected to under-perform the SCOR PK. But the pink sheet apears to be less risky and, when comparing its historical volatility, Aston Martin Lagonda is 1.43 times less risky than SCOR PK. The pink sheet trades about -0.12 of its potential returns per unit of risk. The SCOR PK is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  254.00  in SCOR PK on October 5, 2024 and sell it today you would lose (7.00) from holding SCOR PK or give up 2.76% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Aston Martin Lagonda  vs.  SCOR PK

 Performance 
       Timeline  
Aston Martin Lagonda 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Aston Martin Lagonda has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.
SCOR PK 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in SCOR PK are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, SCOR PK showed solid returns over the last few months and may actually be approaching a breakup point.

Aston Martin and SCOR PK Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Aston Martin and SCOR PK

The main advantage of trading using opposite Aston Martin and SCOR PK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aston Martin position performs unexpectedly, SCOR PK 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 SCOR PK will offset losses from the drop in SCOR PK's long position.
The idea behind Aston Martin Lagonda and SCOR PK 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

Other Complementary Tools

Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Watchlist Optimization
Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm
Financial Widgets
Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Latest Portfolios
Quick portfolio dashboard that showcases your latest portfolios