Correlation Between Acelon Chemicals and Comtrend Corp
Can any of the company-specific risk be diversified away by investing in both Acelon Chemicals and Comtrend Corp 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 Comtrend Corp 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 Comtrend Corp, you can compare the effects of market volatilities on Acelon Chemicals and Comtrend Corp 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 Comtrend Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acelon Chemicals and Comtrend Corp.
Diversification Opportunities for Acelon Chemicals and Comtrend Corp
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Acelon and Comtrend is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Acelon Chemicals Fiber and Comtrend Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comtrend Corp 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 Comtrend Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comtrend Corp has no effect on the direction of Acelon Chemicals i.e., Acelon Chemicals and Comtrend Corp go up and down completely randomly.
Pair Corralation between Acelon Chemicals and Comtrend Corp
Assuming the 90 days trading horizon Acelon Chemicals Fiber is expected to generate 0.34 times more return on investment than Comtrend Corp. However, Acelon Chemicals Fiber is 2.97 times less risky than Comtrend Corp. It trades about 0.69 of its potential returns per unit of risk. Comtrend Corp is currently generating about -0.06 per unit of risk. If you would invest 1,175 in Acelon Chemicals Fiber on November 28, 2024 and sell it today you would earn a total of 185.00 from holding Acelon Chemicals Fiber or generate 15.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acelon Chemicals Fiber vs. Comtrend Corp
Performance |
| Timeline |
| Acelon Chemicals Fiber |
| Comtrend Corp |
Acelon Chemicals and Comtrend Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acelon Chemicals and Comtrend Corp
The main advantage of trading using opposite Acelon Chemicals and Comtrend Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acelon Chemicals position performs unexpectedly, Comtrend Corp 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 Comtrend Corp will offset losses from the drop in Comtrend Corp's long position.| Acelon Chemicals vs. Honmyue Enterprise Co | Acelon Chemicals vs. Tainan Spinning Co | Acelon Chemicals vs. Chia Her Industrial | Acelon Chemicals vs. Zig Sheng Industrial |
| Comtrend Corp vs. Accton Technology Corp | Comtrend Corp vs. HTC Corp | Comtrend Corp vs. Wistron NeWeb Corp | Comtrend Corp vs. Arcadyan Technology Corp |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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