Correlation Between Skardin Industrial and Gemtek Technology
Can any of the company-specific risk be diversified away by investing in both Skardin Industrial and Gemtek 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 Skardin Industrial and Gemtek Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Skardin Industrial and Gemtek Technology Co, you can compare the effects of market volatilities on Skardin Industrial and Gemtek 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 Skardin Industrial with a short position of Gemtek Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Skardin Industrial and Gemtek Technology.
Diversification Opportunities for Skardin Industrial and Gemtek Technology
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Skardin and Gemtek is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Skardin Industrial and Gemtek Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gemtek Technology and Skardin Industrial 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 Skardin Industrial are associated (or correlated) with Gemtek Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gemtek Technology has no effect on the direction of Skardin Industrial i.e., Skardin Industrial and Gemtek Technology go up and down completely randomly.
Pair Corralation between Skardin Industrial and Gemtek Technology
Assuming the 90 days trading horizon Skardin Industrial is expected to generate 1.71 times more return on investment than Gemtek Technology. However, Skardin Industrial is 1.71 times more volatile than Gemtek Technology Co. It trades about 0.11 of its potential returns per unit of risk. Gemtek Technology Co is currently generating about 0.01 per unit of risk. If you would invest 2,655 in Skardin Industrial on September 12, 2024 and sell it today you would earn a total of 3,705 from holding Skardin Industrial or generate 139.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Skardin Industrial vs. Gemtek Technology Co
Performance |
| Timeline |
| Skardin Industrial |
| Gemtek Technology |
Skardin Industrial and Gemtek Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Skardin Industrial and Gemtek Technology
The main advantage of trading using opposite Skardin Industrial and Gemtek Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Skardin Industrial position performs unexpectedly, Gemtek 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 Gemtek Technology will offset losses from the drop in Gemtek Technology's long position.| Skardin Industrial vs. Gemtek Technology Co | Skardin Industrial vs. Ruentex Development Co | Skardin Industrial vs. WiseChip Semiconductor | Skardin Industrial vs. Novatek Microelectronics Corp |
| Gemtek Technology vs. AU Optronics | Gemtek Technology vs. Innolux Corp | Gemtek Technology vs. Ruentex Development Co | Gemtek Technology vs. WiseChip Semiconductor |
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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