Correlation Between Aspeed Technology and Advancetek Enterprise
Can any of the company-specific risk be diversified away by investing in both Aspeed Technology and Advancetek Enterprise 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 Aspeed Technology and Advancetek Enterprise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aspeed Technology and Advancetek Enterprise Co, you can compare the effects of market volatilities on Aspeed Technology and Advancetek Enterprise 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 Aspeed Technology with a short position of Advancetek Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspeed Technology and Advancetek Enterprise.
Diversification Opportunities for Aspeed Technology and Advancetek Enterprise
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aspeed and Advancetek is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Aspeed Technology and Advancetek Enterprise Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advancetek Enterprise and Aspeed 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 Aspeed Technology are associated (or correlated) with Advancetek Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advancetek Enterprise has no effect on the direction of Aspeed Technology i.e., Aspeed Technology and Advancetek Enterprise go up and down completely randomly.
Pair Corralation between Aspeed Technology and Advancetek Enterprise
Assuming the 90 days trading horizon Aspeed Technology is expected to under-perform the Advancetek Enterprise. In addition to that, Aspeed Technology is 1.16 times more volatile than Advancetek Enterprise Co. It trades about -0.02 of its total potential returns per unit of risk. Advancetek Enterprise Co is currently generating about 0.37 per unit of volatility. If you would invest 6,410 in Advancetek Enterprise Co on August 30, 2024 and sell it today you would earn a total of 1,720 from holding Advancetek Enterprise Co or generate 26.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aspeed Technology vs. Advancetek Enterprise Co
Performance |
| Timeline |
| Aspeed Technology |
| Advancetek Enterprise |
Aspeed Technology and Advancetek Enterprise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aspeed Technology and Advancetek Enterprise
The main advantage of trading using opposite Aspeed Technology and Advancetek Enterprise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aspeed Technology position performs unexpectedly, Advancetek Enterprise 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 Advancetek Enterprise will offset losses from the drop in Advancetek Enterprise's long position.| Aspeed Technology vs. Asmedia Technology | Aspeed Technology vs. Silergy Corp | Aspeed Technology vs. Parade Technologies | Aspeed Technology vs. Wiwynn Corp |
| Advancetek Enterprise vs. Tainan Spinning Co | Advancetek Enterprise vs. Carnival Industrial Corp | Advancetek Enterprise vs. Symtek Automation Asia | Advancetek Enterprise vs. CTCI Corp |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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