Correlation Between People Technology and Cloud Air
Can any of the company-specific risk be diversified away by investing in both People Technology and Cloud Air 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 People Technology and Cloud Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between People Technology and Cloud Air CoLtd, you can compare the effects of market volatilities on People Technology and Cloud Air 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 People Technology with a short position of Cloud Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of People Technology and Cloud Air.
Diversification Opportunities for People Technology and Cloud Air
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between People and Cloud is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding People Technology and Cloud Air CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cloud Air CoLtd and People 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 People Technology are associated (or correlated) with Cloud Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cloud Air CoLtd has no effect on the direction of People Technology i.e., People Technology and Cloud Air go up and down completely randomly.
Pair Corralation between People Technology and Cloud Air
Assuming the 90 days trading horizon People Technology is expected to generate 2.15 times more return on investment than Cloud Air. However, People Technology is 2.15 times more volatile than Cloud Air CoLtd. It trades about 0.01 of its potential returns per unit of risk. Cloud Air CoLtd is currently generating about 0.0 per unit of risk. If you would invest 4,950,000 in People Technology on August 25, 2024 and sell it today you would lose (310,000) from holding People Technology or give up 6.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.19% |
| Values | Daily Returns |
People Technology vs. Cloud Air CoLtd
Performance |
| Timeline |
| People Technology |
| Cloud Air CoLtd |
People Technology and Cloud Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with People Technology and Cloud Air
The main advantage of trading using opposite People Technology and Cloud Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if People Technology position performs unexpectedly, Cloud Air 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 Cloud Air will offset losses from the drop in Cloud Air's long position.| People Technology vs. Woori Technology | People Technology vs. Lion Chemtech Co | People Technology vs. ABCO Electronics Co | People Technology vs. Korea Alcohol Industrial |
| Cloud Air vs. SK Hynix | Cloud Air vs. People Technology | Cloud Air vs. SIMMTECH Co | Cloud Air vs. Haesung DS 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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