Correlation Between Asmedia Technology and Aker Technology
Can any of the company-specific risk be diversified away by investing in both Asmedia Technology and Aker 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 Aker 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 Aker Technology Co, you can compare the effects of market volatilities on Asmedia Technology and Aker 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 Aker Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asmedia Technology and Aker Technology.
Diversification Opportunities for Asmedia Technology and Aker Technology
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Asmedia and Aker is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Asmedia Technology and Aker Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aker 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 Aker Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aker Technology has no effect on the direction of Asmedia Technology i.e., Asmedia Technology and Aker Technology go up and down completely randomly.
Pair Corralation between Asmedia Technology and Aker Technology
Assuming the 90 days trading horizon Asmedia Technology is expected to generate 1.68 times more return on investment than Aker Technology. However, Asmedia Technology is 1.68 times more volatile than Aker Technology Co. It trades about 0.06 of its potential returns per unit of risk. Aker Technology Co is currently generating about 0.03 per unit of risk. If you would invest 77,589 in Asmedia Technology on September 3, 2024 and sell it today you would earn a total of 83,911 from holding Asmedia Technology or generate 108.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.78% |
| Values | Daily Returns |
Asmedia Technology vs. Aker Technology Co
Performance |
| Timeline |
| Asmedia Technology |
| Aker Technology |
Asmedia Technology and Aker Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asmedia Technology and Aker Technology
The main advantage of trading using opposite Asmedia Technology and Aker Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asmedia Technology position performs unexpectedly, Aker 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 Aker Technology will offset losses from the drop in Aker Technology's long position.| Asmedia Technology vs. Taiwan Semiconductor Manufacturing | Asmedia Technology vs. Yang Ming Marine | Asmedia Technology vs. ASE Industrial Holding | Asmedia Technology vs. AU Optronics |
| Aker Technology vs. Tang Eng Iron | Aker Technology vs. Yeou Yih Steel | Aker Technology vs. Arima Communications Corp | Aker Technology vs. Quintain Steel Co |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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