Correlation Between Aker Technology and Asmedia Technology
Can any of the company-specific risk be diversified away by investing in both Aker Technology and Asmedia 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 Aker Technology and Asmedia Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aker Technology Co and Asmedia Technology, you can compare the effects of market volatilities on Aker Technology and Asmedia 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 Aker Technology with a short position of Asmedia Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aker Technology and Asmedia Technology.
Diversification Opportunities for Aker Technology and Asmedia Technology
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aker and Asmedia is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Aker Technology Co and Asmedia Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asmedia Technology and Aker 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 Aker Technology Co are associated (or correlated) with Asmedia Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asmedia Technology has no effect on the direction of Aker Technology i.e., Aker Technology and Asmedia Technology go up and down completely randomly.
Pair Corralation between Aker Technology and Asmedia Technology
Assuming the 90 days trading horizon Aker Technology Co is expected to generate 0.73 times more return on investment than Asmedia Technology. However, Aker Technology Co is 1.37 times less risky than Asmedia Technology. It trades about 0.23 of its potential returns per unit of risk. Asmedia Technology is currently generating about 0.05 per unit of risk. If you would invest 2,185 in Aker Technology Co on December 1, 2024 and sell it today you would earn a total of 205.00 from holding Aker Technology Co or generate 9.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aker Technology Co vs. Asmedia Technology
Performance |
| Timeline |
| Aker Technology |
| Asmedia Technology |
Aker Technology and Asmedia Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aker Technology and Asmedia Technology
The main advantage of trading using opposite Aker Technology and Asmedia Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aker Technology position performs unexpectedly, Asmedia 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 Asmedia Technology will offset losses from the drop in Asmedia Technology's long position.| Aker Technology vs. International CSRC Investment | Aker Technology vs. Genovate Biotechnology Co | Aker Technology vs. ANJI Technology Co | Aker Technology vs. Tradetool Auto Co |
| Asmedia Technology vs. Alchip Technologies | Asmedia Technology vs. Aspeed Technology | Asmedia Technology vs. Silergy Corp | Asmedia Technology vs. Global Unichip 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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