Correlation Between P Duke and Allis Electric
Can any of the company-specific risk be diversified away by investing in both P Duke and Allis Electric 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 P Duke and Allis Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between P Duke Technology Co and Allis Electric Co, you can compare the effects of market volatilities on P Duke and Allis Electric 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 P Duke with a short position of Allis Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of P Duke and Allis Electric.
Diversification Opportunities for P Duke and Allis Electric
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 8109 and Allis is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding P Duke Technology Co and Allis Electric Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allis Electric and P Duke 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 P Duke Technology Co are associated (or correlated) with Allis Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allis Electric has no effect on the direction of P Duke i.e., P Duke and Allis Electric go up and down completely randomly.
Pair Corralation between P Duke and Allis Electric
Assuming the 90 days trading horizon P Duke Technology Co is expected to under-perform the Allis Electric. But the stock apears to be less risky and, when comparing its historical volatility, P Duke Technology Co is 5.86 times less risky than Allis Electric. The stock trades about -0.06 of its potential returns per unit of risk. The Allis Electric Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 11,300 in Allis Electric Co on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Allis Electric Co or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
P Duke Technology Co vs. Allis Electric Co
Performance |
| Timeline |
| P Duke Technology |
| Allis Electric |
P Duke and Allis Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with P Duke and Allis Electric
The main advantage of trading using opposite P Duke and Allis Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if P Duke position performs unexpectedly, Allis Electric 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 Allis Electric will offset losses from the drop in Allis Electric's long position.| P Duke vs. Sporton International | P Duke vs. Planet Technology | P Duke vs. Posiflex Technology | P Duke vs. ECOVE Environment Corp |
| Allis Electric vs. Yulon Motor Co | Allis Electric vs. Far Eastern Department | Allis Electric vs. China Steel Corp | Allis Electric vs. Chang Hwa Commercial |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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