Correlation Between Ampire and Sitronix Technology
Can any of the company-specific risk be diversified away by investing in both Ampire and Sitronix 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 Ampire and Sitronix Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ampire Co and Sitronix Technology Corp, you can compare the effects of market volatilities on Ampire and Sitronix 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 Ampire with a short position of Sitronix Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ampire and Sitronix Technology.
Diversification Opportunities for Ampire and Sitronix Technology
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ampire and Sitronix is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Ampire Co and Sitronix Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sitronix Technology Corp and Ampire 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 Ampire Co are associated (or correlated) with Sitronix Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sitronix Technology Corp has no effect on the direction of Ampire i.e., Ampire and Sitronix Technology go up and down completely randomly.
Pair Corralation between Ampire and Sitronix Technology
Assuming the 90 days trading horizon Ampire Co is expected to generate 0.46 times more return on investment than Sitronix Technology. However, Ampire Co is 2.17 times less risky than Sitronix Technology. It trades about -0.22 of its potential returns per unit of risk. Sitronix Technology Corp is currently generating about -0.13 per unit of risk. If you would invest 3,475 in Ampire Co on September 4, 2024 and sell it today you would lose (100.00) from holding Ampire Co or give up 2.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ampire Co vs. Sitronix Technology Corp
Performance |
| Timeline |
| Ampire |
| Sitronix Technology Corp |
Ampire and Sitronix Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ampire and Sitronix Technology
The main advantage of trading using opposite Ampire and Sitronix Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ampire position performs unexpectedly, Sitronix 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 Sitronix Technology will offset losses from the drop in Sitronix Technology's long position.| Ampire vs. Asia Tech Image | Ampire vs. Emerging Display Technologies | Ampire vs. DRWu Skincare Co | Ampire vs. Lanner Electronics |
| Sitronix Technology vs. Novatek Microelectronics Corp | Sitronix Technology vs. FocalTech Systems Co | Sitronix Technology vs. Elan Microelectronics Corp | Sitronix Technology vs. Realtek Semiconductor 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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