Correlation Between Ablerex Electronics and Microelectronics
Can any of the company-specific risk be diversified away by investing in both Ablerex Electronics and Microelectronics 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 Ablerex Electronics and Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ablerex Electronics Co and Microelectronics Technology, you can compare the effects of market volatilities on Ablerex Electronics and Microelectronics 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 Ablerex Electronics with a short position of Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ablerex Electronics and Microelectronics.
Diversification Opportunities for Ablerex Electronics and Microelectronics
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ablerex and Microelectronics is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Ablerex Electronics Co and Microelectronics Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microelectronics Tec and Ablerex Electronics 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 Ablerex Electronics Co are associated (or correlated) with Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microelectronics Tec has no effect on the direction of Ablerex Electronics i.e., Ablerex Electronics and Microelectronics go up and down completely randomly.
Pair Corralation between Ablerex Electronics and Microelectronics
Assuming the 90 days trading horizon Ablerex Electronics Co is expected to generate 0.42 times more return on investment than Microelectronics. However, Ablerex Electronics Co is 2.38 times less risky than Microelectronics. It trades about -0.16 of its potential returns per unit of risk. Microelectronics Technology is currently generating about -0.07 per unit of risk. If you would invest 4,630 in Ablerex Electronics Co on October 25, 2024 and sell it today you would lose (225.00) from holding Ablerex Electronics Co or give up 4.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ablerex Electronics Co vs. Microelectronics Technology
Performance |
| Timeline |
| Ablerex Electronics |
| Microelectronics Tec |
Ablerex Electronics and Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ablerex Electronics and Microelectronics
The main advantage of trading using opposite Ablerex Electronics and Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ablerex Electronics position performs unexpectedly, Microelectronics 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 Microelectronics will offset losses from the drop in Microelectronics' long position.| Ablerex Electronics vs. Advantech Co | Ablerex Electronics vs. IEI Integration Corp | Ablerex Electronics vs. Flytech Technology Co | Ablerex Electronics vs. Ennoconn Corp |
| Microelectronics vs. Unimicron Technology Corp | Microelectronics vs. Kinsus Interconnect Technology | Microelectronics vs. Novatek Microelectronics Corp | Microelectronics vs. Delta Electronics |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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