Correlation Between United States and Bet-at-home

Can any of the company-specific risk be diversified away by investing in both United States and Bet-at-home 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 United States and Bet-at-home into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between United States Steel and bet at home AG, you can compare the effects of market volatilities on United States and Bet-at-home 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 United States with a short position of Bet-at-home. Check out your portfolio center. Please also check ongoing floating volatility patterns of United States and Bet-at-home.

Diversification Opportunities for United States and Bet-at-home

-0.05

Correlation Coefficient

United States  Bet-at-home

Good diversification

The 3 months correlation between United and Bet-at-home is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding United States Steel and bet at home AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on bet at home and United States 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 United States Steel are associated (or correlated) with Bet-at-home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of bet at home has no effect on the direction of United States i.e., United States and Bet-at-home go up and down completely randomly.

Pair Corralation between United States and Bet-at-home

Assuming the 90 days trading horizon United States Steel is expected to under-perform the Bet-at-home. In addition to that, United States is 2.8 times more volatile than bet at home AG. It trades about -0.25 of its total potential returns per unit of risk. bet at home AG is currently generating about -0.07 per unit of volatility. If you would invest  249.00  in bet at home AG on October 9, 2024 and sell it today you would lose (5.00) from holding bet at home AG or give up 2.01% of portfolio value over 90 days.

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

United States Steel  vs.  bet at home AG

United States Steel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days United States Steel has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, United States is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

bet at home

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days bet at home AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with United States and Bet-at-home

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

The idea behind United States Steel and bet at home AG 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..