Correlation Between Advanced Technology and GRIPM Advanced
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By analyzing existing cross correlation between Advanced Technology Materials and GRIPM Advanced Materials, you can compare the effects of market volatilities on Advanced Technology and GRIPM Advanced 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 GRIPM Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Technology and GRIPM Advanced.
Diversification Opportunities for Advanced Technology and GRIPM Advanced
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Advanced and GRIPM is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Technology Materials and GRIPM Advanced Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRIPM Advanced Materials 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 GRIPM Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRIPM Advanced Materials has no effect on the direction of Advanced Technology i.e., Advanced Technology and GRIPM Advanced go up and down completely randomly.
Pair Corralation between Advanced Technology and GRIPM Advanced
Assuming the 90 days trading horizon Advanced Technology Materials is expected to generate 1.65 times more return on investment than GRIPM Advanced. However, Advanced Technology is 1.65 times more volatile than GRIPM Advanced Materials. It trades about 0.19 of its potential returns per unit of risk. GRIPM Advanced Materials is currently generating about 0.11 per unit of risk. If you would invest 1,022 in Advanced Technology Materials on August 30, 2024 and sell it today you would earn a total of 178.00 from holding Advanced Technology Materials or generate 17.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advanced Technology Materials vs. GRIPM Advanced Materials
Performance |
| Timeline |
| Advanced Technology |
| GRIPM Advanced Materials |
Advanced Technology and GRIPM Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Technology and GRIPM Advanced
The main advantage of trading using opposite Advanced Technology and GRIPM Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Technology position performs unexpectedly, GRIPM Advanced 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 GRIPM Advanced will offset losses from the drop in GRIPM Advanced's long position.| Advanced Technology vs. Bomin Electronics Co | Advanced Technology vs. Shenzhen Clou Electronics | Advanced Technology vs. Shuhua Sports Co | Advanced Technology vs. Ningbo Jianan Electronics |
| GRIPM Advanced vs. Shandong Gold Mining | GRIPM Advanced vs. Rongsheng Petrochemical Co | GRIPM Advanced vs. Inner Mongolia BaoTou | GRIPM Advanced vs. Jiangxi Ganfeng Lithium |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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