Correlation Between De Licacy and Aker Technology
Can any of the company-specific risk be diversified away by investing in both De Licacy and Aker 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 De Licacy and Aker Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between De Licacy Industrial and Aker Technology Co, you can compare the effects of market volatilities on De Licacy and Aker 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 De Licacy with a short position of Aker Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of De Licacy and Aker Technology.
Diversification Opportunities for De Licacy and Aker Technology
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between 1464 and Aker is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding De Licacy Industrial and Aker Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aker Technology and De Licacy 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 De Licacy Industrial are associated (or correlated) with Aker Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aker Technology has no effect on the direction of De Licacy i.e., De Licacy and Aker Technology go up and down completely randomly.
Pair Corralation between De Licacy and Aker Technology
Assuming the 90 days trading horizon De Licacy Industrial is expected to generate 0.63 times more return on investment than Aker Technology. However, De Licacy Industrial is 1.58 times less risky than Aker Technology. It trades about 0.03 of its potential returns per unit of risk. Aker Technology Co is currently generating about 0.0 per unit of risk. If you would invest 1,400 in De Licacy Industrial on October 16, 2024 and sell it today you would earn a total of 285.00 from holding De Licacy Industrial or generate 20.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
De Licacy Industrial vs. Aker Technology Co
Performance |
| Timeline |
| De Licacy Industrial |
| Aker Technology |
De Licacy and Aker Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with De Licacy and Aker Technology
The main advantage of trading using opposite De Licacy and Aker Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if De Licacy position performs unexpectedly, Aker 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 Aker Technology will offset losses from the drop in Aker Technology's long position.| De Licacy vs. Tainan Enterprises Co | De Licacy vs. Nien Hsing Textile | De Licacy vs. Wisher Industrial Co | De Licacy vs. Tex Ray Industrial Co |
| Aker Technology vs. Aerospace Industrial Development | Aker Technology vs. De Licacy Industrial | Aker Technology vs. Wha Yu Industrial | Aker Technology vs. Unique Optical Industrial |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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