Correlation Between Amogreentech and A Tech
Can any of the company-specific risk be diversified away by investing in both Amogreentech and A Tech 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 Amogreentech and A Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amogreentech Co and A Tech Solution Co, you can compare the effects of market volatilities on Amogreentech and A Tech 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 Amogreentech with a short position of A Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amogreentech and A Tech.
Diversification Opportunities for Amogreentech and A Tech
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amogreentech and 071670 is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Amogreentech Co and A Tech Solution Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A Tech Solution and Amogreentech 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 Amogreentech Co are associated (or correlated) with A Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A Tech Solution has no effect on the direction of Amogreentech i.e., Amogreentech and A Tech go up and down completely randomly.
Pair Corralation between Amogreentech and A Tech
Assuming the 90 days trading horizon Amogreentech Co is expected to generate 1.37 times more return on investment than A Tech. However, Amogreentech is 1.37 times more volatile than A Tech Solution Co. It trades about -0.06 of its potential returns per unit of risk. A Tech Solution Co is currently generating about -0.09 per unit of risk. If you would invest 709,000 in Amogreentech Co on August 28, 2024 and sell it today you would lose (42,000) from holding Amogreentech Co or give up 5.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amogreentech Co vs. A Tech Solution Co
Performance |
| Timeline |
| Amogreentech |
| A Tech Solution |
Amogreentech and A Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amogreentech and A Tech
The main advantage of trading using opposite Amogreentech and A Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amogreentech position performs unexpectedly, A Tech 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 A Tech will offset losses from the drop in A Tech's long position.The idea behind Amogreentech Co and A Tech Solution 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.| A Tech vs. Daedong Metals Co | A Tech vs. Hanjin Transportation Co | A Tech vs. LG Chemicals | A Tech vs. Nable Communications |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |