Correlation Between Airtac International and Goodway Machine
Can any of the company-specific risk be diversified away by investing in both Airtac International and Goodway Machine 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 Airtac International and Goodway Machine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airtac International Group and Goodway Machine Corp, you can compare the effects of market volatilities on Airtac International and Goodway Machine 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 Airtac International with a short position of Goodway Machine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airtac International and Goodway Machine.
Diversification Opportunities for Airtac International and Goodway Machine
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Airtac and Goodway is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Airtac International Group and Goodway Machine Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goodway Machine Corp and Airtac International 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 Airtac International Group are associated (or correlated) with Goodway Machine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goodway Machine Corp has no effect on the direction of Airtac International i.e., Airtac International and Goodway Machine go up and down completely randomly.
Pair Corralation between Airtac International and Goodway Machine
Assuming the 90 days trading horizon Airtac International Group is expected to under-perform the Goodway Machine. In addition to that, Airtac International is 2.07 times more volatile than Goodway Machine Corp. It trades about -0.03 of its total potential returns per unit of risk. Goodway Machine Corp is currently generating about -0.03 per unit of volatility. If you would invest 6,650 in Goodway Machine Corp on September 2, 2024 and sell it today you would lose (640.00) from holding Goodway Machine Corp or give up 9.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airtac International Group vs. Goodway Machine Corp
Performance |
| Timeline |
| Airtac International |
| Goodway Machine Corp |
Airtac International and Goodway Machine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airtac International and Goodway Machine
The main advantage of trading using opposite Airtac International and Goodway Machine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airtac International position performs unexpectedly, Goodway Machine 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 Goodway Machine will offset losses from the drop in Goodway Machine's long position.| Airtac International vs. Hiwin Technologies Corp | Airtac International vs. Advantech Co | Airtac International vs. Delta Electronics | Airtac International vs. Eclat Textile Co |
| Goodway Machine vs. Easywell Biomedicals | Goodway Machine vs. Louisa Professional Coffee | Goodway Machine vs. Great China Metal | Goodway Machine vs. Chailease Holding Co |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Commodity Directory Find actively traded commodities issued by global exchanges |