Correlation Between ASICS and Asics Corp

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

By analyzing existing cross correlation between ASICS and Asics Corp ADR, you can compare the effects of market volatilities on ASICS and Asics Corp 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 ASICS with a short position of Asics Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASICS and Asics Corp.

Diversification Opportunities for ASICS and Asics Corp

0.15

Correlation Coefficient

ASICS  Asics Corp

Average diversification

The 3 months correlation between ASICS and Asics is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding ASICS and Asics Corp ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asics Corp ADR and ASICS 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 ASICS are associated (or correlated) with Asics Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asics Corp ADR has no effect on the direction of ASICS i.e., ASICS and Asics Corp go up and down completely randomly.

Pair Corralation between ASICS and Asics Corp

Assuming the 90 days horizon ASICS is expected to generate 20.37 times less return on investment than Asics Corp. In addition to that, ASICS is 1.18 times more volatile than Asics Corp ADR. It trades about 0.0 of its total potential returns per unit of risk. Asics Corp ADR is currently generating about 0.05 per unit of volatility. If you would invest  1,966  in Asics Corp ADR on September 3, 2024 and sell it today you would earn a total of  130.00  from holding Asics Corp ADR or generate 6.61% return on investment over 90 days.

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

ASICS  vs.  Asics Corp ADR

ASICS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ASICS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, ASICS is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Asics Corp ADR

Risk-Adjusted Performance

4 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Asics Corp ADR are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile fundamental indicators, Asics Corp may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with ASICS and Asics Corp

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

The idea behind ASICS and Asics Corp ADR 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.