Correlation Between AVer Information and Ardentec
Can any of the company-specific risk be diversified away by investing in both AVer Information 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 AVer Information and Ardentec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AVer Information and Ardentec, you can compare the effects of market volatilities on AVer Information 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 AVer Information with a short position of Ardentec. Check out your portfolio center. Please also check ongoing floating volatility patterns of AVer Information and Ardentec.
Diversification Opportunities for AVer Information and Ardentec
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AVer and Ardentec is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding AVer Information and Ardentec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ardentec and AVer Information 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 AVer Information 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 AVer Information i.e., AVer Information and Ardentec go up and down completely randomly.
Pair Corralation between AVer Information and Ardentec
Assuming the 90 days trading horizon AVer Information is expected to generate 1.45 times more return on investment than Ardentec. However, AVer Information is 1.45 times more volatile than Ardentec. It trades about 0.02 of its potential returns per unit of risk. Ardentec is currently generating about -0.01 per unit of risk. If you would invest 3,915 in AVer Information on September 12, 2024 and sell it today you would earn a total of 190.00 from holding AVer Information or generate 4.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AVer Information vs. Ardentec
Performance |
| Timeline |
| AVer Information |
| Ardentec |
AVer Information and Ardentec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AVer Information and Ardentec
The main advantage of trading using opposite AVer Information and Ardentec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AVer Information 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.| AVer Information vs. AU Optronics | AVer Information vs. Innolux Corp | AVer Information vs. Ruentex Development Co | AVer Information vs. WiseChip Semiconductor |
| Ardentec vs. Tang Eng Iron | Ardentec vs. Information Technology Total | Ardentec vs. Evergreen International Storage | Ardentec vs. AVer Information |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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