Correlation Between Asseco South and Inter Cars

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

By analyzing existing cross correlation between Asseco South Eastern and Inter Cars SA, you can compare the effects of market volatilities on Asseco South and Inter Cars 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 Asseco South with a short position of Inter Cars. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asseco South and Inter Cars.

Diversification Opportunities for Asseco South and Inter Cars

0.0

Correlation Coefficient

Asseco South  Inter Cars

Pay attention - limited upside

The 3 months correlation between Asseco and Inter is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Asseco South Eastern and Inter Cars SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inter Cars SA and Asseco South 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 Asseco South Eastern are associated (or correlated) with Inter Cars. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inter Cars SA has no effect on the direction of Asseco South i.e., Asseco South and Inter Cars go up and down completely randomly.

Pair Corralation between Asseco South and Inter Cars

If you would invest  52,800  in Inter Cars SA on October 7, 2024 and sell it today you would earn a total of  800.00  from holding Inter Cars SA or generate 1.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Asseco South Eastern  vs.  Inter Cars SA

Asseco South Eastern

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Asseco South Eastern has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Asseco South is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Inter Cars SA

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Inter Cars SA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Inter Cars may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Asseco South and Inter Cars

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

The idea behind Asseco South Eastern and Inter Cars SA 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.