Correlation Between AVerMedia Technologies and Kwong Fong
Can any of the company-specific risk be diversified away by investing in both AVerMedia Technologies and Kwong Fong 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 AVerMedia Technologies and Kwong Fong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AVerMedia Technologies and Kwong Fong Industries, you can compare the effects of market volatilities on AVerMedia Technologies and Kwong Fong 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 AVerMedia Technologies with a short position of Kwong Fong. Check out your portfolio center. Please also check ongoing floating volatility patterns of AVerMedia Technologies and Kwong Fong.
Diversification Opportunities for AVerMedia Technologies and Kwong Fong
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AVerMedia and Kwong is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding AVerMedia Technologies and Kwong Fong Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kwong Fong Industries and AVerMedia Technologies 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 AVerMedia Technologies are associated (or correlated) with Kwong Fong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kwong Fong Industries has no effect on the direction of AVerMedia Technologies i.e., AVerMedia Technologies and Kwong Fong go up and down completely randomly.
Pair Corralation between AVerMedia Technologies and Kwong Fong
Assuming the 90 days trading horizon AVerMedia Technologies is expected to under-perform the Kwong Fong. In addition to that, AVerMedia Technologies is 1.64 times more volatile than Kwong Fong Industries. It trades about -0.05 of its total potential returns per unit of risk. Kwong Fong Industries is currently generating about 0.0 per unit of volatility. If you would invest 1,310 in Kwong Fong Industries on September 2, 2024 and sell it today you would lose (30.00) from holding Kwong Fong Industries or give up 2.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AVerMedia Technologies vs. Kwong Fong Industries
Performance |
| Timeline |
| AVerMedia Technologies |
| Kwong Fong Industries |
AVerMedia Technologies and Kwong Fong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AVerMedia Technologies and Kwong Fong
The main advantage of trading using opposite AVerMedia Technologies and Kwong Fong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AVerMedia Technologies position performs unexpectedly, Kwong Fong 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 Kwong Fong will offset losses from the drop in Kwong Fong's long position.| AVerMedia Technologies vs. Chaintech Technology Corp | AVerMedia Technologies vs. Avision | AVerMedia Technologies vs. Clevo Co | AVerMedia Technologies vs. Elitegroup Computer Systems |
| Kwong Fong vs. Sunspring Metal Corp | Kwong Fong vs. First Copper Technology | Kwong Fong vs. Shinkong Insurance Co | Kwong Fong vs. Central Reinsurance 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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