Correlation Between 2S Metal and AddTech Hub
Can any of the company-specific risk be diversified away by investing in both 2S Metal and AddTech Hub 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 2S Metal and AddTech Hub into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 2S Metal Public and AddTech Hub Public, you can compare the effects of market volatilities on 2S Metal and AddTech Hub 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 2S Metal with a short position of AddTech Hub. Check out your portfolio center. Please also check ongoing floating volatility patterns of 2S Metal and AddTech Hub.
Diversification Opportunities for 2S Metal and AddTech Hub
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 2S Metal and AddTech is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding 2S Metal Public and AddTech Hub Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AddTech Hub Public and 2S Metal 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 2S Metal Public are associated (or correlated) with AddTech Hub. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AddTech Hub Public has no effect on the direction of 2S Metal i.e., 2S Metal and AddTech Hub go up and down completely randomly.
Pair Corralation between 2S Metal and AddTech Hub
Assuming the 90 days horizon 2S Metal Public is expected to under-perform the AddTech Hub. But the stock apears to be less risky and, when comparing its historical volatility, 2S Metal Public is 1.15 times less risky than AddTech Hub. The stock trades about -0.04 of its potential returns per unit of risk. The AddTech Hub Public is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 451.00 in AddTech Hub Public on September 3, 2024 and sell it today you would earn a total of 11.00 from holding AddTech Hub Public or generate 2.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
2S Metal Public vs. AddTech Hub Public
Performance |
| Timeline |
| 2S Metal Public |
| AddTech Hub Public |
2S Metal and AddTech Hub Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 2S Metal and AddTech Hub
The main advantage of trading using opposite 2S Metal and AddTech Hub positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 2S Metal position performs unexpectedly, AddTech Hub 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 AddTech Hub will offset losses from the drop in AddTech Hub's long position.| 2S Metal vs. Diamond Building Products | 2S Metal vs. MCS Steel Public | 2S Metal vs. Asia Green Energy | 2S Metal vs. Hwa Fong Rubber |
| AddTech Hub vs. Forth Public | AddTech Hub vs. Ditto Public | AddTech Hub vs. II Group Public | AddTech Hub vs. After You Public |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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