Correlation Between Alliance Financial and Pantech Group
Can any of the company-specific risk be diversified away by investing in both Alliance Financial and Pantech Group 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 Alliance Financial and Pantech Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alliance Financial Group and Pantech Group Holdings, you can compare the effects of market volatilities on Alliance Financial and Pantech Group 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 Alliance Financial with a short position of Pantech Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliance Financial and Pantech Group.
Diversification Opportunities for Alliance Financial and Pantech Group
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alliance and Pantech is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Alliance Financial Group and Pantech Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pantech Group Holdings and Alliance Financial 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 Alliance Financial Group are associated (or correlated) with Pantech Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pantech Group Holdings has no effect on the direction of Alliance Financial i.e., Alliance Financial and Pantech Group go up and down completely randomly.
Pair Corralation between Alliance Financial and Pantech Group
Assuming the 90 days trading horizon Alliance Financial Group is expected to generate 1.09 times more return on investment than Pantech Group. However, Alliance Financial is 1.09 times more volatile than Pantech Group Holdings. It trades about 0.13 of its potential returns per unit of risk. Pantech Group Holdings is currently generating about -0.11 per unit of risk. If you would invest 516.00 in Alliance Financial Group on November 29, 2024 and sell it today you would earn a total of 14.00 from holding Alliance Financial Group or generate 2.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alliance Financial Group vs. Pantech Group Holdings
Performance |
| Timeline |
| Alliance Financial |
| Pantech Group Holdings |
Alliance Financial and Pantech Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alliance Financial and Pantech Group
The main advantage of trading using opposite Alliance Financial and Pantech Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliance Financial position performs unexpectedly, Pantech Group 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 Pantech Group will offset losses from the drop in Pantech Group's long position.| Alliance Financial vs. MClean Technologies Bhd | Alliance Financial vs. Dnonce Tech Bhd | Alliance Financial vs. Nova Wellness Group | Alliance Financial vs. Sunway Construction Group |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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