Correlation Between Adata Technology and Ardentec
Can any of the company-specific risk be diversified away by investing in both Adata Technology and Ardentec 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 Adata Technology and Ardentec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adata Technology Co and Ardentec, you can compare the effects of market volatilities on Adata Technology and Ardentec 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 Adata Technology with a short position of Ardentec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adata Technology and Ardentec.
Diversification Opportunities for Adata Technology and Ardentec
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Adata and Ardentec is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Adata Technology Co and Ardentec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ardentec and Adata 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 Adata Technology Co are associated (or correlated) with Ardentec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ardentec has no effect on the direction of Adata Technology i.e., Adata Technology and Ardentec go up and down completely randomly.
Pair Corralation between Adata Technology and Ardentec
Assuming the 90 days trading horizon Adata Technology Co is expected to under-perform the Ardentec. In addition to that, Adata Technology is 1.08 times more volatile than Ardentec. It trades about -0.01 of its total potential returns per unit of risk. Ardentec is currently generating about 0.03 per unit of volatility. If you would invest 5,920 in Ardentec on October 28, 2024 and sell it today you would earn a total of 970.00 from holding Ardentec or generate 16.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Adata Technology Co vs. Ardentec
Performance |
| Timeline |
| Adata Technology |
| Ardentec |
Adata Technology and Ardentec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adata Technology and Ardentec
The main advantage of trading using opposite Adata Technology and Ardentec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adata Technology position performs unexpectedly, Ardentec 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 Ardentec will offset losses from the drop in Ardentec's long position.| Adata Technology vs. WIN Semiconductors | Adata Technology vs. Visual Photonics Epitaxy | Adata Technology vs. GlobalWafers Co | Adata Technology vs. Unimicron Technology Corp |
| Ardentec vs. Sports Gear Co | Ardentec vs. Emerging Display Technologies | Ardentec vs. TWOWAY Communications | Ardentec vs. U Ming Marine Transport |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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