Correlation Between Poya International and Xxentria Technology
Can any of the company-specific risk be diversified away by investing in both Poya International and Xxentria 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 Poya International and Xxentria Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Poya International Co and Xxentria Technology Materials, you can compare the effects of market volatilities on Poya International and Xxentria 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 Poya International with a short position of Xxentria Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Poya International and Xxentria Technology.
Diversification Opportunities for Poya International and Xxentria Technology
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Poya and Xxentria is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Poya International Co and Xxentria Technology Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xxentria Technology and Poya International 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 Poya International Co are associated (or correlated) with Xxentria Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xxentria Technology has no effect on the direction of Poya International i.e., Poya International and Xxentria Technology go up and down completely randomly.
Pair Corralation between Poya International and Xxentria Technology
Assuming the 90 days trading horizon Poya International Co is expected to under-perform the Xxentria Technology. But the stock apears to be less risky and, when comparing its historical volatility, Poya International Co is 1.76 times less risky than Xxentria Technology. The stock trades about -0.21 of its potential returns per unit of risk. The Xxentria Technology Materials is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 5,340 in Xxentria Technology Materials on October 26, 2024 and sell it today you would earn a total of 290.00 from holding Xxentria Technology Materials or generate 5.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Poya International Co vs. Xxentria Technology Materials
Performance |
| Timeline |
| Poya International |
| Xxentria Technology |
Poya International and Xxentria Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Poya International and Xxentria Technology
The main advantage of trading using opposite Poya International and Xxentria Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Poya International position performs unexpectedly, Xxentria 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 Xxentria Technology will offset losses from the drop in Xxentria Technology's long position.| Poya International vs. Tong Yang Industry | Poya International vs. Ta Yih Industrial | Poya International vs. Basso Industry Corp | Poya International vs. China Motor Corp |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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