Correlation Between Casing Macron and Answer Technology
Can any of the company-specific risk be diversified away by investing in both Casing Macron and Answer Technology 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 Casing Macron and Answer Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Casing Macron Technology and Answer Technology Co, you can compare the effects of market volatilities on Casing Macron and Answer Technology 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 Casing Macron with a short position of Answer Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Casing Macron and Answer Technology.
Diversification Opportunities for Casing Macron and Answer Technology
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Casing and Answer is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Casing Macron Technology and Answer Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Answer Technology and Casing Macron 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 Casing Macron Technology are associated (or correlated) with Answer Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Answer Technology has no effect on the direction of Casing Macron i.e., Casing Macron and Answer Technology go up and down completely randomly.
Pair Corralation between Casing Macron and Answer Technology
Assuming the 90 days trading horizon Casing Macron Technology is expected to generate 1.99 times more return on investment than Answer Technology. However, Casing Macron is 1.99 times more volatile than Answer Technology Co. It trades about 0.05 of its potential returns per unit of risk. Answer Technology Co is currently generating about 0.01 per unit of risk. If you would invest 1,265 in Casing Macron Technology on August 30, 2024 and sell it today you would earn a total of 925.00 from holding Casing Macron Technology or generate 73.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Casing Macron Technology vs. Answer Technology Co
Performance |
| Timeline |
| Casing Macron Technology |
| Answer Technology |
Casing Macron and Answer Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Casing Macron and Answer Technology
The main advantage of trading using opposite Casing Macron and Answer Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Casing Macron position performs unexpectedly, Answer Technology 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 Answer Technology will offset losses from the drop in Answer Technology's long position.| Casing Macron vs. Xander International | Casing Macron vs. MetaTech AP | Casing Macron vs. Niching Industrial | Casing Macron vs. Sentronic International |
| Answer Technology vs. Xander International | Answer Technology vs. MetaTech AP | Answer Technology vs. Niching Industrial | Answer Technology vs. Sentronic International |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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