Correlation Between Asahi Group and Heineken Holding
Can any of the company-specific risk be diversified away by investing in both Asahi Group and Heineken Holding 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 Asahi Group and Heineken Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asahi Group Holdings and Heineken Holding NV, you can compare the effects of market volatilities on Asahi Group and Heineken Holding 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 Asahi Group with a short position of Heineken Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asahi Group and Heineken Holding.
Diversification Opportunities for Asahi Group and Heineken Holding
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Asahi and Heineken is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Asahi Group Holdings and Heineken Holding NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heineken Holding and Asahi Group 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 Asahi Group Holdings are associated (or correlated) with Heineken Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heineken Holding has no effect on the direction of Asahi Group i.e., Asahi Group and Heineken Holding go up and down completely randomly.
Pair Corralation between Asahi Group and Heineken Holding
Assuming the 90 days horizon Asahi Group Holdings is expected to generate 1.23 times more return on investment than Heineken Holding. However, Asahi Group is 1.23 times more volatile than Heineken Holding NV. It trades about 0.12 of its potential returns per unit of risk. Heineken Holding NV is currently generating about -0.28 per unit of risk. If you would invest 985.00 in Asahi Group Holdings on September 25, 2024 and sell it today you would earn a total of 30.00 from holding Asahi Group Holdings or generate 3.05% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 95.45% |
Values | Daily Returns |
Asahi Group Holdings vs. Heineken Holding NV
Performance |
Timeline |
Asahi Group Holdings |
Heineken Holding |
Asahi Group and Heineken Holding Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Asahi Group and Heineken Holding
The main advantage of trading using opposite Asahi Group and Heineken Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asahi Group position performs unexpectedly, Heineken Holding 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 Heineken Holding will offset losses from the drop in Heineken Holding's long position.Asahi Group vs. FOMECONMEXSAB DCV UTS | Asahi Group vs. Heineken NV | Asahi Group vs. HEINEKEN SP ADR | Asahi Group vs. Ambev SA |
Heineken Holding vs. FOMECONMEXSAB DCV UTS | Heineken Holding vs. Heineken NV | Heineken Holding vs. HEINEKEN SP ADR | Heineken Holding vs. Ambev SA |
Check out your portfolio center.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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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