Correlation Between Advanced Technology and Easyhome New
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By analyzing existing cross correlation between Advanced Technology Materials and Easyhome New Retail, you can compare the effects of market volatilities on Advanced Technology and Easyhome New 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 Advanced Technology with a short position of Easyhome New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Technology and Easyhome New.
Diversification Opportunities for Advanced Technology and Easyhome New
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Advanced and Easyhome is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Technology Materials and Easyhome New Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Easyhome New Retail and Advanced Technology 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 Advanced Technology Materials are associated (or correlated) with Easyhome New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Easyhome New Retail has no effect on the direction of Advanced Technology i.e., Advanced Technology and Easyhome New go up and down completely randomly.
Pair Corralation between Advanced Technology and Easyhome New
Assuming the 90 days trading horizon Advanced Technology Materials is expected to generate 0.7 times more return on investment than Easyhome New. However, Advanced Technology Materials is 1.42 times less risky than Easyhome New. It trades about 0.2 of its potential returns per unit of risk. Easyhome New Retail is currently generating about -0.21 per unit of risk. If you would invest 1,056 in Advanced Technology Materials on November 7, 2024 and sell it today you would earn a total of 96.00 from holding Advanced Technology Materials or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advanced Technology Materials vs. Easyhome New Retail
Performance |
| Timeline |
| Advanced Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
| Easyhome New Retail |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Advanced Technology and Easyhome New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Technology and Easyhome New
The main advantage of trading using opposite Advanced Technology and Easyhome New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Technology position performs unexpectedly, Easyhome New 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 Easyhome New will offset losses from the drop in Easyhome New's long position.The idea behind Advanced Technology Materials and Easyhome New Retail 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 the Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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