Correlation Between Goodway Machine and Airtac International
Can any of the company-specific risk be diversified away by investing in both Goodway Machine and Airtac International 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 Goodway Machine and Airtac International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goodway Machine Corp and Airtac International Group, you can compare the effects of market volatilities on Goodway Machine and Airtac International 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 Goodway Machine with a short position of Airtac International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goodway Machine and Airtac International.
Diversification Opportunities for Goodway Machine and Airtac International
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Goodway and Airtac is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Goodway Machine Corp and Airtac International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airtac International and Goodway Machine 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 Goodway Machine Corp are associated (or correlated) with Airtac International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airtac International has no effect on the direction of Goodway Machine i.e., Goodway Machine and Airtac International go up and down completely randomly.
Pair Corralation between Goodway Machine and Airtac International
Assuming the 90 days trading horizon Goodway Machine Corp is expected to generate 0.48 times more return on investment than Airtac International. However, Goodway Machine Corp is 2.1 times less risky than Airtac International. It trades about 0.01 of its potential returns per unit of risk. Airtac International Group is currently generating about -0.01 per unit of risk. If you would invest 5,895 in Goodway Machine Corp on August 31, 2024 and sell it today you would earn a total of 115.00 from holding Goodway Machine Corp or generate 1.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.78% |
| Values | Daily Returns |
Goodway Machine Corp vs. Airtac International Group
Performance |
| Timeline |
| Goodway Machine Corp |
| Airtac International |
Goodway Machine and Airtac International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goodway Machine and Airtac International
The main advantage of trading using opposite Goodway Machine and Airtac International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goodway Machine position performs unexpectedly, Airtac International 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 Airtac International will offset losses from the drop in Airtac International's long position.| Goodway Machine vs. BES Engineering Co | Goodway Machine vs. Continental Holdings Corp | Goodway Machine vs. Kee Tai Properties | Goodway Machine vs. Hung Sheng Construction |
| Airtac International vs. BES Engineering Co | Airtac International vs. Continental Holdings Corp | Airtac International vs. Kee Tai Properties | Airtac International vs. Hung Sheng Construction |
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 CEOs Directory module to screen CEOs from public companies around the world.
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