Correlation Between People Technology and NewFlex Technology
Can any of the company-specific risk be diversified away by investing in both People Technology and NewFlex Technology 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 NewFlex Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between People Technology and NewFlex Technology Co, you can compare the effects of market volatilities on People Technology and NewFlex 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 People Technology with a short position of NewFlex Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of People Technology and NewFlex Technology.
Diversification Opportunities for People Technology and NewFlex Technology
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between People and NewFlex is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding People Technology and NewFlex Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NewFlex Technology 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 NewFlex Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NewFlex Technology has no effect on the direction of People Technology i.e., People Technology and NewFlex Technology go up and down completely randomly.
Pair Corralation between People Technology and NewFlex Technology
Assuming the 90 days trading horizon People Technology is expected to generate 1.67 times more return on investment than NewFlex Technology. However, People Technology is 1.67 times more volatile than NewFlex Technology Co. It trades about -0.1 of its potential returns per unit of risk. NewFlex Technology Co is currently generating about -0.28 per unit of risk. If you would invest 5,120,000 in People Technology on August 25, 2024 and sell it today you would lose (480,000) from holding People Technology or give up 9.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
People Technology vs. NewFlex Technology Co
Performance |
| Timeline |
| People Technology |
| NewFlex Technology |
People Technology and NewFlex Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with People Technology and NewFlex Technology
The main advantage of trading using opposite People Technology and NewFlex Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if People Technology position performs unexpectedly, NewFlex 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 NewFlex Technology will offset losses from the drop in NewFlex Technology's long position.| People Technology vs. Samsung Electronics Co | People Technology vs. Samsung Electronics Co | People Technology vs. Hyundai Motor Co | People Technology vs. Hyundai Motor |
| NewFlex Technology vs. Korea Real Estate | NewFlex Technology vs. Korea Ratings Co | NewFlex Technology vs. IQuest Co | NewFlex Technology vs. Wonbang Tech 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |