Correlation Between Asia Tech and ANJI Technology
Can any of the company-specific risk be diversified away by investing in both Asia Tech and ANJI 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 Asia Tech and ANJI Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Tech Image and ANJI Technology Co, you can compare the effects of market volatilities on Asia Tech and ANJI 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 Asia Tech with a short position of ANJI Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Tech and ANJI Technology.
Diversification Opportunities for Asia Tech and ANJI Technology
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Asia and ANJI is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Asia Tech Image and ANJI Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANJI Technology and Asia Tech 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 Asia Tech Image are associated (or correlated) with ANJI Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANJI Technology has no effect on the direction of Asia Tech i.e., Asia Tech and ANJI Technology go up and down completely randomly.
Pair Corralation between Asia Tech and ANJI Technology
Assuming the 90 days trading horizon Asia Tech Image is expected to generate 0.83 times more return on investment than ANJI Technology. However, Asia Tech Image is 1.2 times less risky than ANJI Technology. It trades about 0.07 of its potential returns per unit of risk. ANJI Technology Co is currently generating about -0.04 per unit of risk. If you would invest 6,480 in Asia Tech Image on September 12, 2024 and sell it today you would earn a total of 2,660 from holding Asia Tech Image or generate 41.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Tech Image vs. ANJI Technology Co
Performance |
| Timeline |
| Asia Tech Image |
| ANJI Technology |
Asia Tech and ANJI Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Tech and ANJI Technology
The main advantage of trading using opposite Asia Tech and ANJI Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Tech position performs unexpectedly, ANJI 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 ANJI Technology will offset losses from the drop in ANJI Technology's long position.| Asia Tech vs. ANJI Technology Co | Asia Tech vs. Emerging Display Technologies | Asia Tech vs. U Tech Media Corp | Asia Tech vs. Ruentex Development Co |
| ANJI Technology vs. AU Optronics | ANJI Technology vs. Innolux Corp | ANJI Technology vs. Ruentex Development Co | ANJI 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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