Correlation Between Equitable Holdings and ASSGENERALI ADR

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

By analyzing existing cross correlation between Equitable Holdings and ASSGENERALI ADR 12EO, you can compare the effects of market volatilities on Equitable Holdings and ASSGENERALI ADR 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 Equitable Holdings with a short position of ASSGENERALI ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equitable Holdings and ASSGENERALI ADR.

Diversification Opportunities for Equitable Holdings and ASSGENERALI ADR

0.57

Correlation Coefficient

Equitable Holdings  ASSGENERALI ADR

Very weak diversification

The 3 months correlation between Equitable and ASSGENERALI is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Equitable Holdings and ASSGENERALI ADR 12EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASSGENERALI ADR 12EO and Equitable Holdings 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 Equitable Holdings are associated (or correlated) with ASSGENERALI ADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASSGENERALI ADR 12EO has no effect on the direction of Equitable Holdings i.e., Equitable Holdings and ASSGENERALI ADR go up and down completely randomly.

Pair Corralation between Equitable Holdings and ASSGENERALI ADR

Assuming the 90 days horizon Equitable Holdings is expected to under-perform the ASSGENERALI ADR. But the stock apears to be less risky and, when comparing its historical volatility, Equitable Holdings is 1.31 times less risky than ASSGENERALI ADR. The stock trades about -0.11 of its potential returns per unit of risk. The ASSGENERALI ADR 12EO is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  1,330  in ASSGENERALI ADR 12EO on September 23, 2024 and sell it today you would lose (10.00) from holding ASSGENERALI ADR 12EO or give up 0.75% of portfolio value over 90 days.

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

Equitable Holdings  vs.  ASSGENERALI ADR 12EO

Equitable Holdings

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Equitable Holdings are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Equitable Holdings reported solid returns over the last few months and may actually be approaching a breakup point.

ASSGENERALI ADR 12EO

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ASSGENERALI ADR 12EO are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, ASSGENERALI ADR is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Equitable Holdings and ASSGENERALI ADR

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

The idea behind Equitable Holdings and ASSGENERALI ADR 12EO 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.