Correlation Between Atinum Investment and Inzi Display
Can any of the company-specific risk be diversified away by investing in both Atinum Investment and Inzi Display 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 Atinum Investment and Inzi Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atinum Investment Co and Inzi Display CoLtd, you can compare the effects of market volatilities on Atinum Investment and Inzi Display 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 Atinum Investment with a short position of Inzi Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atinum Investment and Inzi Display.
Diversification Opportunities for Atinum Investment and Inzi Display
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Atinum and Inzi is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Atinum Investment Co and Inzi Display CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inzi Display CoLtd and Atinum Investment 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 Atinum Investment Co are associated (or correlated) with Inzi Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inzi Display CoLtd has no effect on the direction of Atinum Investment i.e., Atinum Investment and Inzi Display go up and down completely randomly.
Pair Corralation between Atinum Investment and Inzi Display
Assuming the 90 days trading horizon Atinum Investment Co is expected to generate 2.03 times more return on investment than Inzi Display. However, Atinum Investment is 2.03 times more volatile than Inzi Display CoLtd. It trades about -0.13 of its potential returns per unit of risk. Inzi Display CoLtd is currently generating about -0.35 per unit of risk. If you would invest 257,500 in Atinum Investment Co on September 1, 2024 and sell it today you would lose (22,000) from holding Atinum Investment Co or give up 8.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atinum Investment Co vs. Inzi Display CoLtd
Performance |
| Timeline |
| Atinum Investment |
| Inzi Display CoLtd |
Atinum Investment and Inzi Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atinum Investment and Inzi Display
The main advantage of trading using opposite Atinum Investment and Inzi Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atinum Investment position performs unexpectedly, Inzi Display 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 Inzi Display will offset losses from the drop in Inzi Display's long position.The idea behind Atinum Investment Co and Inzi Display CoLtd 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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