Correlation Between Awanbiru Technology and Dufu Tech
Can any of the company-specific risk be diversified away by investing in both Awanbiru Technology and Dufu Tech 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 Awanbiru Technology and Dufu Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Awanbiru Technology Bhd and Dufu Tech Corp, you can compare the effects of market volatilities on Awanbiru Technology and Dufu Tech 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 Awanbiru Technology with a short position of Dufu Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Awanbiru Technology and Dufu Tech.
Diversification Opportunities for Awanbiru Technology and Dufu Tech
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Awanbiru and Dufu is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Awanbiru Technology Bhd and Dufu Tech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dufu Tech Corp and Awanbiru Technology 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 Awanbiru Technology Bhd are associated (or correlated) with Dufu Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dufu Tech Corp has no effect on the direction of Awanbiru Technology i.e., Awanbiru Technology and Dufu Tech go up and down completely randomly.
Pair Corralation between Awanbiru Technology and Dufu Tech
Assuming the 90 days trading horizon Awanbiru Technology Bhd is expected to generate 2.19 times more return on investment than Dufu Tech. However, Awanbiru Technology is 2.19 times more volatile than Dufu Tech Corp. It trades about 0.02 of its potential returns per unit of risk. Dufu Tech Corp is currently generating about 0.02 per unit of risk. If you would invest 34.00 in Awanbiru Technology Bhd on September 4, 2024 and sell it today you would lose (2.00) from holding Awanbiru Technology Bhd or give up 5.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Awanbiru Technology Bhd vs. Dufu Tech Corp
Performance |
| Timeline |
| Awanbiru Technology Bhd |
| Dufu Tech Corp |
Awanbiru Technology and Dufu Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Awanbiru Technology and Dufu Tech
The main advantage of trading using opposite Awanbiru Technology and Dufu Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Awanbiru Technology position performs unexpectedly, Dufu Tech 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 Dufu Tech will offset losses from the drop in Dufu Tech's long position.| Awanbiru Technology vs. Diversified Gateway Solutions | Awanbiru Technology vs. Supercomnet Technologies Bhd | Awanbiru Technology vs. Radiant Globaltech Bhd | Awanbiru Technology vs. Pantech Group Holdings |
| Dufu Tech vs. TAS Offshore Bhd | Dufu Tech vs. Awanbiru Technology Bhd | Dufu Tech vs. Farm Price Holdings | Dufu Tech vs. FARM FRESH BERHAD |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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