Correlation Between Allwin Telecommunicatio and Lens Technology
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By analyzing existing cross correlation between Allwin Telecommunication Co and Lens Technology Co, you can compare the effects of market volatilities on Allwin Telecommunicatio and Lens Technology 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 Allwin Telecommunicatio with a short position of Lens Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allwin Telecommunicatio and Lens Technology.
Diversification Opportunities for Allwin Telecommunicatio and Lens Technology
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Allwin and Lens is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Allwin Telecommunication Co and Lens Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lens Technology and Allwin Telecommunicatio 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 Allwin Telecommunication Co are associated (or correlated) with Lens Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lens Technology has no effect on the direction of Allwin Telecommunicatio i.e., Allwin Telecommunicatio and Lens Technology go up and down completely randomly.
Pair Corralation between Allwin Telecommunicatio and Lens Technology
Assuming the 90 days trading horizon Allwin Telecommunication Co is expected to under-perform the Lens Technology. In addition to that, Allwin Telecommunicatio is 1.63 times more volatile than Lens Technology Co. It trades about -0.43 of its total potential returns per unit of risk. Lens Technology Co is currently generating about 0.1 per unit of volatility. If you would invest 2,199 in Lens Technology Co on October 15, 2024 and sell it today you would earn a total of 95.00 from holding Lens Technology Co or generate 4.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allwin Telecommunication Co vs. Lens Technology Co
Performance |
| Timeline |
| Allwin Telecommunicatio |
| Lens Technology |
Allwin Telecommunicatio and Lens Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allwin Telecommunicatio and Lens Technology
The main advantage of trading using opposite Allwin Telecommunicatio and Lens Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allwin Telecommunicatio position performs unexpectedly, Lens Technology 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 Lens Technology will offset losses from the drop in Lens Technology's long position.The idea behind Allwin Telecommunication Co and Lens Technology Co 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.
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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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