Correlation Between Acelon Chemicals and EirGenix
Can any of the company-specific risk be diversified away by investing in both Acelon Chemicals and EirGenix 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 Acelon Chemicals and EirGenix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acelon Chemicals Fiber and EirGenix, you can compare the effects of market volatilities on Acelon Chemicals and EirGenix 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 Acelon Chemicals with a short position of EirGenix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acelon Chemicals and EirGenix.
Diversification Opportunities for Acelon Chemicals and EirGenix
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Acelon and EirGenix is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Acelon Chemicals Fiber and EirGenix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EirGenix and Acelon Chemicals 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 Acelon Chemicals Fiber are associated (or correlated) with EirGenix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EirGenix has no effect on the direction of Acelon Chemicals i.e., Acelon Chemicals and EirGenix go up and down completely randomly.
Pair Corralation between Acelon Chemicals and EirGenix
Assuming the 90 days trading horizon Acelon Chemicals Fiber is expected to generate 0.94 times more return on investment than EirGenix. However, Acelon Chemicals Fiber is 1.06 times less risky than EirGenix. It trades about 0.03 of its potential returns per unit of risk. EirGenix is currently generating about -0.04 per unit of risk. If you would invest 1,170 in Acelon Chemicals Fiber on August 30, 2024 and sell it today you would earn a total of 235.00 from holding Acelon Chemicals Fiber or generate 20.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acelon Chemicals Fiber vs. EirGenix
Performance |
| Timeline |
| Acelon Chemicals Fiber |
| EirGenix |
Acelon Chemicals and EirGenix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acelon Chemicals and EirGenix
The main advantage of trading using opposite Acelon Chemicals and EirGenix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acelon Chemicals position performs unexpectedly, EirGenix 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 EirGenix will offset losses from the drop in EirGenix's long position.| Acelon Chemicals vs. Yulon Finance Corp | Acelon Chemicals vs. Taiwan Secom Co | Acelon Chemicals vs. Great Wall Enterprise |
| EirGenix vs. Elan Microelectronics Corp | EirGenix vs. Oceanic Beverages Co | EirGenix vs. Ambassador Hotel | EirGenix vs. Chung Lien Transportation |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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