Correlation Between Azimut Holding and State Street
Can any of the company-specific risk be diversified away by investing in both Azimut Holding and State Street 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 Azimut Holding and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Azimut Holding SpA and State Street Corp, you can compare the effects of market volatilities on Azimut Holding and State Street 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 Azimut Holding with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azimut Holding and State Street.
Diversification Opportunities for Azimut Holding and State Street
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Azimut and State is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Azimut Holding SpA and State Street Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Corp and Azimut Holding 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 Azimut Holding SpA are associated (or correlated) with State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Corp has no effect on the direction of Azimut Holding i.e., Azimut Holding and State Street go up and down completely randomly.
Pair Corralation between Azimut Holding and State Street
Assuming the 90 days horizon Azimut Holding SpA is expected to under-perform the State Street. In addition to that, Azimut Holding is 1.59 times more volatile than State Street Corp. It trades about -0.17 of its total potential returns per unit of risk. State Street Corp is currently generating about -0.05 per unit of volatility. If you would invest 7,550 in State Street Corp on January 26, 2024 and sell it today you would lose (121.00) from holding State Street Corp or give up 1.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Azimut Holding SpA vs. State Street Corp
Performance |
| Timeline |
| Azimut Holding SpA |
| State Street Corp |
Azimut Holding and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Azimut Holding and State Street
The main advantage of trading using opposite Azimut Holding and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Azimut Holding position performs unexpectedly, State Street 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 State Street will offset losses from the drop in State Street's long position.| Azimut Holding vs. Starfleet Innotech | Azimut Holding vs. Flow Capital Corp | Azimut Holding vs. Blackhawk Growth Corp | Azimut Holding vs. AGF Management Limited |
| State Street vs. Invesco Plc | State Street vs. Franklin Resources | State Street vs. T Rowe Price | State Street vs. SEI Investments |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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