Correlation Between General Interface and Aiptek International
Can any of the company-specific risk be diversified away by investing in both General Interface and Aiptek International 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 General Interface and Aiptek International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Interface Solution and Aiptek International, you can compare the effects of market volatilities on General Interface and Aiptek International 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 General Interface with a short position of Aiptek International. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Interface and Aiptek International.
Diversification Opportunities for General Interface and Aiptek International
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between General and Aiptek is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding General Interface Solution and Aiptek International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aiptek International and General Interface 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 General Interface Solution are associated (or correlated) with Aiptek International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aiptek International has no effect on the direction of General Interface i.e., General Interface and Aiptek International go up and down completely randomly.
Pair Corralation between General Interface and Aiptek International
Assuming the 90 days trading horizon General Interface Solution is expected to under-perform the Aiptek International. But the stock apears to be less risky and, when comparing its historical volatility, General Interface Solution is 1.85 times less risky than Aiptek International. The stock trades about -0.06 of its potential returns per unit of risk. The Aiptek International is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 979.00 in Aiptek International on August 30, 2024 and sell it today you would earn a total of 641.00 from holding Aiptek International or generate 65.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Interface Solution vs. Aiptek International
Performance |
| Timeline |
| General Interface |
| Aiptek International |
General Interface and Aiptek International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Interface and Aiptek International
The main advantage of trading using opposite General Interface and Aiptek International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Interface position performs unexpectedly, Aiptek International 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 Aiptek International will offset losses from the drop in Aiptek International's long position.| General Interface vs. Zhen Ding Technology | General Interface vs. TPK Holding Co | General Interface vs. Catcher Technology Co | General Interface vs. Flexium Interconnect |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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