Correlation Between Intralot and As Commercial

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

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

Diversification Opportunities for Intralot and As Commercial

0.62

Correlation Coefficient

Intralot  As Commercial

Poor diversification

The 3 months correlation between Intralot and ASCO is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Intralot SA Integrated and As Commercial Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on As Commercial Industrial and Intralot 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 Intralot SA Integrated are associated (or correlated) with As Commercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of As Commercial Industrial has no effect on the direction of Intralot i.e., Intralot and As Commercial go up and down completely randomly.

Pair Corralation between Intralot and As Commercial

Assuming the 90 days trading horizon Intralot SA Integrated is expected to under-perform the As Commercial. In addition to that, Intralot is 1.61 times more volatile than As Commercial Industrial. It trades about -0.1 of its total potential returns per unit of risk. As Commercial Industrial is currently generating about 0.02 per unit of volatility. If you would invest  278.00  in As Commercial Industrial on September 14, 2024 and sell it today you would earn a total of  4.00  from holding As Commercial Industrial or generate 1.44% return on investment over 90 days.

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

Intralot SA Integrated  vs.  As Commercial Industrial

Intralot SA Integrated

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intralot SA Integrated has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

As Commercial Industrial

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in As Commercial Industrial are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, As Commercial is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Intralot and As Commercial

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

The idea behind Intralot SA Integrated and As Commercial Industrial 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 Transaction History module to view history of all your transactions and understand their impact on performance.