Correlation Between GTM Holdings and Advancetek Enterprise
Can any of the company-specific risk be diversified away by investing in both GTM Holdings and Advancetek Enterprise 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 GTM Holdings and Advancetek Enterprise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GTM Holdings Corp and Advancetek Enterprise Co, you can compare the effects of market volatilities on GTM Holdings and Advancetek Enterprise 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 GTM Holdings with a short position of Advancetek Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of GTM Holdings and Advancetek Enterprise.
Diversification Opportunities for GTM Holdings and Advancetek Enterprise
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between GTM and Advancetek is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding GTM Holdings Corp and Advancetek Enterprise Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advancetek Enterprise and GTM Holdings 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 GTM Holdings Corp are associated (or correlated) with Advancetek Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advancetek Enterprise has no effect on the direction of GTM Holdings i.e., GTM Holdings and Advancetek Enterprise go up and down completely randomly.
Pair Corralation between GTM Holdings and Advancetek Enterprise
Assuming the 90 days trading horizon GTM Holdings is expected to generate 20.4 times less return on investment than Advancetek Enterprise. But when comparing it to its historical volatility, GTM Holdings Corp is 5.37 times less risky than Advancetek Enterprise. It trades about 0.08 of its potential returns per unit of risk. Advancetek Enterprise Co is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 6,650 in Advancetek Enterprise Co on September 5, 2024 and sell it today you would earn a total of 1,520 from holding Advancetek Enterprise Co or generate 22.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GTM Holdings Corp vs. Advancetek Enterprise Co
Performance |
| Timeline |
| GTM Holdings Corp |
| Advancetek Enterprise |
GTM Holdings and Advancetek Enterprise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GTM Holdings and Advancetek Enterprise
The main advantage of trading using opposite GTM Holdings and Advancetek Enterprise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GTM Holdings position performs unexpectedly, Advancetek Enterprise 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 Advancetek Enterprise will offset losses from the drop in Advancetek Enterprise's long position.| GTM Holdings vs. Taiwan Semiconductor Manufacturing | GTM Holdings vs. Yang Ming Marine | GTM Holdings vs. AU Optronics | GTM Holdings vs. Nan Ya Plastics |
| Advancetek Enterprise vs. Huaku Development Co | Advancetek Enterprise vs. Ruentex Development Co | Advancetek Enterprise vs. Taiwan Cement Corp | Advancetek Enterprise vs. Symtek Automation Asia |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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