Correlation Between Cars and Amicorp FS
Can any of the company-specific risk be diversified away by investing in both Cars and Amicorp FS 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 Cars and Amicorp FS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cars Inc and Amicorp FS PLC, you can compare the effects of market volatilities on Cars and Amicorp FS 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 Cars with a short position of Amicorp FS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cars and Amicorp FS.
Diversification Opportunities for Cars and Amicorp FS
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cars and Amicorp is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Cars Inc and Amicorp FS PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amicorp FS PLC and Cars 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 Cars Inc are associated (or correlated) with Amicorp FS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amicorp FS PLC has no effect on the direction of Cars i.e., Cars and Amicorp FS go up and down completely randomly.
Pair Corralation between Cars and Amicorp FS
Assuming the 90 days trading horizon Cars Inc is expected to under-perform the Amicorp FS. In addition to that, Cars is 40.63 times more volatile than Amicorp FS PLC. It trades about -0.05 of its total potential returns per unit of risk. Amicorp FS PLC is currently generating about 0.12 per unit of volatility. If you would invest 166.00 in Amicorp FS PLC on September 1, 2025 and sell it today you would earn a total of 1.00 from holding Amicorp FS PLC or generate 0.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 77.27% |
| Values | Daily Returns |
Cars Inc vs. Amicorp FS PLC
Performance |
| Timeline |
| Cars Inc |
| Amicorp FS PLC |
Cars and Amicorp FS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cars and Amicorp FS
The main advantage of trading using opposite Cars and Amicorp FS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cars position performs unexpectedly, Amicorp FS 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 Amicorp FS will offset losses from the drop in Amicorp FS's long position.| Cars vs. Ruffer Investment | Cars vs. Molson Coors Beverage | Cars vs. Mineral Financial Investments | Cars vs. Smithson Investment Trust |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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