Correlation Between ADLINK Technology and Chicony Power
Can any of the company-specific risk be diversified away by investing in both ADLINK Technology and Chicony Power 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 ADLINK Technology and Chicony Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ADLINK Technology and Chicony Power Technology, you can compare the effects of market volatilities on ADLINK Technology and Chicony Power 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 ADLINK Technology with a short position of Chicony Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADLINK Technology and Chicony Power.
Diversification Opportunities for ADLINK Technology and Chicony Power
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ADLINK and Chicony is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding ADLINK Technology and Chicony Power Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chicony Power Technology and ADLINK 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 ADLINK Technology are associated (or correlated) with Chicony Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chicony Power Technology has no effect on the direction of ADLINK Technology i.e., ADLINK Technology and Chicony Power go up and down completely randomly.
Pair Corralation between ADLINK Technology and Chicony Power
Assuming the 90 days trading horizon ADLINK Technology is expected to generate 1.11 times more return on investment than Chicony Power. However, ADLINK Technology is 1.11 times more volatile than Chicony Power Technology. It trades about 0.07 of its potential returns per unit of risk. Chicony Power Technology is currently generating about 0.0 per unit of risk. If you would invest 6,480 in ADLINK Technology on November 4, 2024 and sell it today you would earn a total of 1,060 from holding ADLINK Technology or generate 16.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ADLINK Technology vs. Chicony Power Technology
Performance |
| Timeline |
| ADLINK Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Chicony Power Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ADLINK Technology and Chicony Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ADLINK Technology and Chicony Power
The main advantage of trading using opposite ADLINK Technology and Chicony Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADLINK Technology position performs unexpectedly, Chicony Power 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 Chicony Power will offset losses from the drop in Chicony Power's long position.The idea behind ADLINK Technology and Chicony Power Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |