Correlation Between Clevo and AVerMedia Technologies
Can any of the company-specific risk be diversified away by investing in both Clevo and AVerMedia Technologies 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 Clevo and AVerMedia Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clevo Co and AVerMedia Technologies, you can compare the effects of market volatilities on Clevo and AVerMedia Technologies 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 Clevo with a short position of AVerMedia Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clevo and AVerMedia Technologies.
Diversification Opportunities for Clevo and AVerMedia Technologies
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Clevo and AVerMedia is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Clevo Co and AVerMedia Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AVerMedia Technologies and Clevo 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 Clevo Co are associated (or correlated) with AVerMedia Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AVerMedia Technologies has no effect on the direction of Clevo i.e., Clevo and AVerMedia Technologies go up and down completely randomly.
Pair Corralation between Clevo and AVerMedia Technologies
Assuming the 90 days trading horizon Clevo Co is expected to generate 0.5 times more return on investment than AVerMedia Technologies. However, Clevo Co is 1.99 times less risky than AVerMedia Technologies. It trades about 0.02 of its potential returns per unit of risk. AVerMedia Technologies is currently generating about -0.03 per unit of risk. If you would invest 5,150 in Clevo Co on November 3, 2024 and sell it today you would earn a total of 20.00 from holding Clevo Co or generate 0.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clevo Co vs. AVerMedia Technologies
Performance |
| Timeline |
| Clevo |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| AVerMedia Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Clevo and AVerMedia Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clevo and AVerMedia Technologies
The main advantage of trading using opposite Clevo and AVerMedia Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clevo position performs unexpectedly, AVerMedia Technologies 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 AVerMedia Technologies will offset losses from the drop in AVerMedia Technologies' long position.The idea behind Clevo Co and AVerMedia Technologies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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