Correlation Between ASICS and On Holding
Can any of the company-specific risk be diversified away by investing in both ASICS and On Holding 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 On Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASICS and On Holding, you can compare the effects of market volatilities on ASICS and On Holding 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 On Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASICS and On Holding.
Diversification Opportunities for ASICS and On Holding
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ASICS and ONON is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding ASICS and On Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on On Holding 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 On Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of On Holding has no effect on the direction of ASICS i.e., ASICS and On Holding go up and down completely randomly.
Pair Corralation between ASICS and On Holding
Assuming the 90 days horizon ASICS is expected to generate 2.65 times more return on investment than On Holding. However, ASICS is 2.65 times more volatile than On Holding. It trades about 0.04 of its potential returns per unit of risk. On Holding is currently generating about -0.11 per unit of risk. If you would invest 1,946 in ASICS on December 1, 2024 and sell it today you would earn a total of 26.00 from holding ASICS or generate 1.34% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 66.67% |
Values | Daily Returns |
ASICS vs. On Holding
Performance |
Timeline |
ASICS |
On Holding |
ASICS and On Holding Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ASICS and On Holding
The main advantage of trading using opposite ASICS and On Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASICS position performs unexpectedly, On Holding 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 On Holding will offset losses from the drop in On Holding's long position.ASICS vs. American Rebel Holdings | ASICS vs. PUMA SE | ASICS vs. Adidas AG | ASICS vs. American Rebel Holdings |
On Holding vs. Crocs Inc | On Holding vs. Skechers USA | On Holding vs. Nike Inc | On Holding vs. Designer Brands |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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