Correlation Between Galaxy Software and Ablerex Electronics
Can any of the company-specific risk be diversified away by investing in both Galaxy Software and Ablerex Electronics 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 Galaxy Software and Ablerex Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Galaxy Software Services and Ablerex Electronics Co, you can compare the effects of market volatilities on Galaxy Software and Ablerex Electronics 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 Galaxy Software with a short position of Ablerex Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Galaxy Software and Ablerex Electronics.
Diversification Opportunities for Galaxy Software and Ablerex Electronics
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Galaxy and Ablerex is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Galaxy Software Services and Ablerex Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ablerex Electronics and Galaxy Software 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 Galaxy Software Services are associated (or correlated) with Ablerex Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ablerex Electronics has no effect on the direction of Galaxy Software i.e., Galaxy Software and Ablerex Electronics go up and down completely randomly.
Pair Corralation between Galaxy Software and Ablerex Electronics
Assuming the 90 days trading horizon Galaxy Software is expected to generate 1.24 times less return on investment than Ablerex Electronics. In addition to that, Galaxy Software is 1.15 times more volatile than Ablerex Electronics Co. It trades about 0.03 of its total potential returns per unit of risk. Ablerex Electronics Co is currently generating about 0.05 per unit of volatility. If you would invest 4,150 in Ablerex Electronics Co on October 26, 2024 and sell it today you would earn a total of 255.00 from holding Ablerex Electronics Co or generate 6.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Galaxy Software Services vs. Ablerex Electronics Co
Performance |
| Timeline |
| Galaxy Software Services |
| Ablerex Electronics |
Galaxy Software and Ablerex Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Galaxy Software and Ablerex Electronics
The main advantage of trading using opposite Galaxy Software and Ablerex Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Galaxy Software position performs unexpectedly, Ablerex Electronics 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 Ablerex Electronics will offset losses from the drop in Ablerex Electronics' long position.| Galaxy Software vs. Niching Industrial | Galaxy Software vs. Far EasTone Telecommunications | Galaxy Software vs. Jentech Precision Industrial | Galaxy Software vs. Taiwan Mobile Co |
| Ablerex Electronics vs. Galaxy Software Services | Ablerex Electronics vs. Wei Chuan Foods | Ablerex Electronics vs. Acelon Chemicals Fiber | Ablerex Electronics vs. Johnson Health Tech |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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