Correlation Between Amtran Technology and Eastern Media
Can any of the company-specific risk be diversified away by investing in both Amtran Technology and Eastern Media 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 Amtran Technology and Eastern Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amtran Technology Co and Eastern Media International, you can compare the effects of market volatilities on Amtran Technology and Eastern Media 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 Amtran Technology with a short position of Eastern Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amtran Technology and Eastern Media.
Diversification Opportunities for Amtran Technology and Eastern Media
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amtran and Eastern is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Amtran Technology Co and Eastern Media International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern Media Intern and Amtran Technology 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 Amtran Technology Co are associated (or correlated) with Eastern Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Media Intern has no effect on the direction of Amtran Technology i.e., Amtran Technology and Eastern Media go up and down completely randomly.
Pair Corralation between Amtran Technology and Eastern Media
Assuming the 90 days trading horizon Amtran Technology Co is expected to under-perform the Eastern Media. In addition to that, Amtran Technology is 1.39 times more volatile than Eastern Media International. It trades about -0.45 of its total potential returns per unit of risk. Eastern Media International is currently generating about -0.05 per unit of volatility. If you would invest 1,865 in Eastern Media International on August 24, 2024 and sell it today you would lose (30.00) from holding Eastern Media International or give up 1.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amtran Technology Co vs. Eastern Media International
Performance |
| Timeline |
| Amtran Technology |
| Eastern Media Intern |
Amtran Technology and Eastern Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amtran Technology and Eastern Media
The main advantage of trading using opposite Amtran Technology and Eastern Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amtran Technology position performs unexpectedly, Eastern Media 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 Eastern Media will offset losses from the drop in Eastern Media's long position.| Amtran Technology vs. De Licacy Industrial | Amtran Technology vs. Kwong Fong Industries | Amtran Technology vs. Leatec Fine Ceramics | Amtran Technology vs. Information Technology Total |
| Eastern Media vs. Ichia Technologies | Eastern Media vs. Elan Microelectronics Corp | Eastern Media vs. Amtran Technology Co | Eastern Media vs. Sunplus Technology 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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