Correlation Between Miller Industries and Autoliv
Can any of the company-specific risk be diversified away by investing in both Miller Industries and Autoliv 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 Miller Industries and Autoliv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Miller Industries and Autoliv, you can compare the effects of market volatilities on Miller Industries and Autoliv 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 Miller Industries with a short position of Autoliv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Miller Industries and Autoliv.
Diversification Opportunities for Miller Industries and Autoliv
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Miller and Autoliv is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Miller Industries and Autoliv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autoliv and Miller Industries 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 Miller Industries are associated (or correlated) with Autoliv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autoliv has no effect on the direction of Miller Industries i.e., Miller Industries and Autoliv go up and down completely randomly.
Pair Corralation between Miller Industries and Autoliv
Considering the 90-day investment horizon Miller Industries is expected to generate 1.46 times more return on investment than Autoliv. However, Miller Industries is 1.46 times more volatile than Autoliv. It trades about -0.01 of its potential returns per unit of risk. Autoliv is currently generating about -0.12 per unit of risk. If you would invest 4,998 in Miller Industries on January 25, 2024 and sell it today you would lose (26.00) from holding Miller Industries or give up 0.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Miller Industries vs. Autoliv
Performance |
| Timeline |
| Miller Industries |
| Autoliv |
Miller Industries and Autoliv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Miller Industries and Autoliv
The main advantage of trading using opposite Miller Industries and Autoliv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Miller Industries position performs unexpectedly, Autoliv 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 Autoliv will offset losses from the drop in Autoliv's long position.| Miller Industries vs. Motorcar Parts of | Miller Industries vs. Monro Muffler Brake | Miller Industries vs. Stoneridge | Miller Industries vs. Superior Industries International |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Stocks Directory Find actively traded stocks across global markets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |