Correlation Between Armada Hflr and AURUBIS AG
Can any of the company-specific risk be diversified away by investing in both Armada Hflr and AURUBIS AG 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 Armada Hflr and AURUBIS AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and AURUBIS AG UNSPADR, you can compare the effects of market volatilities on Armada Hflr and AURUBIS AG 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 Armada Hflr with a short position of AURUBIS AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and AURUBIS AG.
Diversification Opportunities for Armada Hflr and AURUBIS AG
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Armada and AURUBIS is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and AURUBIS AG UNSPADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AURUBIS AG UNSPADR and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with AURUBIS AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AURUBIS AG UNSPADR has no effect on the direction of Armada Hflr i.e., Armada Hflr and AURUBIS AG go up and down completely randomly.
Pair Corralation between Armada Hflr and AURUBIS AG
Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the AURUBIS AG. But the stock apears to be less risky and, when comparing its historical volatility, Armada Hflr Pr is 1.67 times less risky than AURUBIS AG. The stock trades about -0.14 of its potential returns per unit of risk. The AURUBIS AG UNSPADR is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,940 in AURUBIS AG UNSPADR on September 25, 2024 and sell it today you would earn a total of 700.00 from holding AURUBIS AG UNSPADR or generate 23.81% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.44% |
Values | Daily Returns |
Armada Hflr Pr vs. AURUBIS AG UNSPADR
Performance |
Timeline |
Armada Hflr Pr |
AURUBIS AG UNSPADR |
Armada Hflr and AURUBIS AG Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Armada Hflr and AURUBIS AG
The main advantage of trading using opposite Armada Hflr and AURUBIS AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, AURUBIS AG 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 AURUBIS AG will offset losses from the drop in AURUBIS AG's long position.Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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