Correlation Between As Commercial and Elton International

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

By analyzing existing cross correlation between As Commercial Industrial and Elton International Trading, you can compare the effects of market volatilities on As Commercial and Elton International 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 As Commercial with a short position of Elton International. Check out your portfolio center. Please also check ongoing floating volatility patterns of As Commercial and Elton International.

Diversification Opportunities for As Commercial and Elton International

-0.36

Correlation Coefficient

As Commercial  Elton International

Very good diversification

The 3 months correlation between ASCO and Elton is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding As Commercial Industrial and Elton International Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elton International and As Commercial 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 As Commercial Industrial are associated (or correlated) with Elton International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elton International has no effect on the direction of As Commercial i.e., As Commercial and Elton International go up and down completely randomly.

Pair Corralation between As Commercial and Elton International

Assuming the 90 days trading horizon As Commercial Industrial is expected to generate 1.38 times more return on investment than Elton International. However, As Commercial is 1.38 times more volatile than Elton International Trading. It trades about 0.26 of its potential returns per unit of risk. Elton International Trading is currently generating about -0.05 per unit of risk. If you would invest  281.00  in As Commercial Industrial on December 29, 2024 and sell it today you would earn a total of  83.00  from holding As Commercial Industrial or generate 29.54% return on investment over 90 days.

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

As Commercial Industrial  vs.  Elton International Trading

As Commercial Industrial

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in As Commercial Industrial are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, As Commercial unveiled solid returns over the last few months and may actually be approaching a breakup point.

Elton International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Elton International Trading has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Elton International is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with As Commercial and Elton International

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

The idea behind As Commercial Industrial and Elton International Trading 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.