Correlation Between AeroSpace Technology and Genic
Can any of the company-specific risk be diversified away by investing in both AeroSpace Technology and Genic 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 AeroSpace Technology and Genic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AeroSpace Technology of and Genic Co, you can compare the effects of market volatilities on AeroSpace Technology and Genic 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 AeroSpace Technology with a short position of Genic. Check out your portfolio center. Please also check ongoing floating volatility patterns of AeroSpace Technology and Genic.
Diversification Opportunities for AeroSpace Technology and Genic
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AeroSpace and Genic is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding AeroSpace Technology of and Genic Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genic and AeroSpace 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 AeroSpace Technology of are associated (or correlated) with Genic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genic has no effect on the direction of AeroSpace Technology i.e., AeroSpace Technology and Genic go up and down completely randomly.
Pair Corralation between AeroSpace Technology and Genic
Assuming the 90 days trading horizon AeroSpace Technology of is expected to generate 0.6 times more return on investment than Genic. However, AeroSpace Technology of is 1.66 times less risky than Genic. It trades about 0.66 of its potential returns per unit of risk. Genic Co is currently generating about -0.19 per unit of risk. If you would invest 52,200 in AeroSpace Technology of on November 7, 2024 and sell it today you would earn a total of 22,600 from holding AeroSpace Technology of or generate 43.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 89.47% |
| Values | Daily Returns |
AeroSpace Technology of vs. Genic Co
Performance |
| Timeline |
| AeroSpace Technology |
| Genic |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
AeroSpace Technology and Genic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AeroSpace Technology and Genic
The main advantage of trading using opposite AeroSpace Technology and Genic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AeroSpace Technology position performs unexpectedly, Genic 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 Genic will offset losses from the drop in Genic's long position.| AeroSpace Technology vs. Hanil Chemical Ind | AeroSpace Technology vs. Namhae Chemical | AeroSpace Technology vs. Neungyule Education | AeroSpace Technology vs. Dongnam Chemical Co |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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