Correlation Between Asia Plus and Asia Sermkij

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Can any of the company-specific risk be diversified away by investing in both Asia Plus and Asia Sermkij 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 Asia Plus and Asia Sermkij into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Plus Group and Asia Sermkij Leasing, you can compare the effects of market volatilities on Asia Plus and Asia Sermkij 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 Asia Plus with a short position of Asia Sermkij. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Plus and Asia Sermkij.

Diversification Opportunities for Asia Plus and Asia Sermkij

0.78
  Correlation Coefficient

Poor diversification

The 3 months correlation between Asia and Asia is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Asia Plus Group and Asia Sermkij Leasing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Sermkij Leasing and Asia Plus 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 Asia Plus Group are associated (or correlated) with Asia Sermkij. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Sermkij Leasing has no effect on the direction of Asia Plus i.e., Asia Plus and Asia Sermkij go up and down completely randomly.

Pair Corralation between Asia Plus and Asia Sermkij

Assuming the 90 days trading horizon Asia Plus Group is expected to generate 0.5 times more return on investment than Asia Sermkij. However, Asia Plus Group is 1.99 times less risky than Asia Sermkij. It trades about -0.33 of its potential returns per unit of risk. Asia Sermkij Leasing is currently generating about -0.26 per unit of risk. If you would invest  244.00  in Asia Plus Group on October 8, 2024 and sell it today you would lose (10.00) from holding Asia Plus Group or give up 4.1% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Asia Plus Group  vs.  Asia Sermkij Leasing

 Performance 
       Timeline  
Asia Plus Group 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Asia Plus Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.
Asia Sermkij Leasing 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Asia Sermkij Leasing has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Asia Plus and Asia Sermkij Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Asia Plus and Asia Sermkij

The main advantage of trading using opposite Asia Plus and Asia Sermkij positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Plus position performs unexpectedly, Asia Sermkij 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 Asia Sermkij will offset losses from the drop in Asia Sermkij's long position.
The idea behind Asia Plus Group and Asia Sermkij Leasing 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.

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