Correlation Between Asmedia Technology and Vate Technology
Can any of the company-specific risk be diversified away by investing in both Asmedia Technology and Vate 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 Asmedia Technology and Vate Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asmedia Technology and Vate Technology Co, you can compare the effects of market volatilities on Asmedia Technology and Vate 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 Asmedia Technology with a short position of Vate Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asmedia Technology and Vate Technology.
Diversification Opportunities for Asmedia Technology and Vate Technology
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Asmedia and Vate is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Asmedia Technology and Vate Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vate Technology and Asmedia 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 Asmedia Technology are associated (or correlated) with Vate Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vate Technology has no effect on the direction of Asmedia Technology i.e., Asmedia Technology and Vate Technology go up and down completely randomly.
Pair Corralation between Asmedia Technology and Vate Technology
Assuming the 90 days trading horizon Asmedia Technology is expected to generate 2.05 times more return on investment than Vate Technology. However, Asmedia Technology is 2.05 times more volatile than Vate Technology Co. It trades about -0.06 of its potential returns per unit of risk. Vate Technology Co is currently generating about -0.32 per unit of risk. If you would invest 163,000 in Asmedia Technology on August 31, 2024 and sell it today you would lose (7,000) from holding Asmedia Technology or give up 4.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asmedia Technology vs. Vate Technology Co
Performance |
| Timeline |
| Asmedia Technology |
| Vate Technology |
Asmedia Technology and Vate Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asmedia Technology and Vate Technology
The main advantage of trading using opposite Asmedia Technology and Vate Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asmedia Technology position performs unexpectedly, Vate 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 Vate Technology will offset losses from the drop in Vate Technology's long position.| Asmedia Technology vs. Alchip Technologies | Asmedia Technology vs. Aspeed Technology | Asmedia Technology vs. Silergy Corp | Asmedia Technology vs. Global Unichip Corp |
| Vate Technology vs. Arbor Technology | Vate Technology vs. Microelectronics Technology | Vate Technology vs. WinMate Communication INC | Vate Technology vs. United Radiant Technology |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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