Correlation Between Procter Gamble and Autozone

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and Autozone 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 Procter Gamble and Autozone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and Autozone, you can compare the effects of market volatilities on Procter Gamble and Autozone 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 Procter Gamble with a short position of Autozone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and Autozone.

Diversification Opportunities for Procter Gamble and Autozone

0.25
  Correlation Coefficient

Modest diversification

The 3 months correlation between Procter and Autozone is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and Autozone in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autozone and Procter Gamble 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 Procter Gamble are associated (or correlated) with Autozone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autozone has no effect on the direction of Procter Gamble i.e., Procter Gamble and Autozone go up and down completely randomly.

Pair Corralation between Procter Gamble and Autozone

Allowing for the 90-day total investment horizon Procter Gamble is expected to generate 1.33 times less return on investment than Autozone. In addition to that, Procter Gamble is 1.29 times more volatile than Autozone. It trades about 0.16 of its total potential returns per unit of risk. Autozone is currently generating about 0.28 per unit of volatility. If you would invest  203,212  in Autozone on May 20, 2022 and sell it today you would earn a total of  28,293  from holding Autozone or generate 13.92% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Procter Gamble  vs.  Autozone

 Performance (%) 
       Timeline  
Procter Gamble 
Procter Performance
5 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Procter Gamble are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Procter Gamble may actually be approaching a critical reversion point that can send shares even higher in September 2022.

Procter Price Channel

Autozone 
Autozone Performance
24 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Autozone are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain basic indicators, Autozone disclosed solid returns over the last few months and may actually be approaching a breakup point.

Autozone Price Channel

Procter Gamble and Autozone Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Procter Gamble and Autozone

The main advantage of trading using opposite Procter Gamble and Autozone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, Autozone 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 Autozone will offset losses from the drop in Autozone's long position.
The idea behind Procter Gamble and Autozone pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

Other Complementary Tools

Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Go
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
Go
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Go
Shere Portfolio
Track or share privately all of your investments from the convenience of any device
Go
Focused Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Go
Price Transformation
Use Price Transformation models to analyze depth of different equity instruments across global markets
Go
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Go