Correlation Between Eagle Cold and Aker Technology
Can any of the company-specific risk be diversified away by investing in both Eagle Cold and Aker 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 Eagle Cold and Aker Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Cold Storage and Aker Technology Co, you can compare the effects of market volatilities on Eagle Cold and Aker 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 Eagle Cold with a short position of Aker Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Cold and Aker Technology.
Diversification Opportunities for Eagle Cold and Aker Technology
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eagle and Aker is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Cold Storage and Aker Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aker Technology and Eagle Cold 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 Eagle Cold Storage are associated (or correlated) with Aker Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aker Technology has no effect on the direction of Eagle Cold i.e., Eagle Cold and Aker Technology go up and down completely randomly.
Pair Corralation between Eagle Cold and Aker Technology
Assuming the 90 days trading horizon Eagle Cold is expected to generate 1.57 times less return on investment than Aker Technology. But when comparing it to its historical volatility, Eagle Cold Storage is 2.99 times less risky than Aker Technology. It trades about 0.05 of its potential returns per unit of risk. Aker Technology Co is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,280 in Aker Technology Co on September 12, 2024 and sell it today you would earn a total of 250.00 from holding Aker Technology Co or generate 10.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eagle Cold Storage vs. Aker Technology Co
Performance |
| Timeline |
| Eagle Cold Storage |
| Aker Technology |
Eagle Cold and Aker Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eagle Cold and Aker Technology
The main advantage of trading using opposite Eagle Cold and Aker Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Cold position performs unexpectedly, Aker 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 Aker Technology will offset losses from the drop in Aker Technology's long position.| Eagle Cold vs. Uni President Enterprises Corp | Eagle Cold vs. Tingyi Holding Corp | Eagle Cold vs. Lien Hwa Industrial | Eagle Cold vs. Great Wall Enterprise |
| Aker Technology vs. Eternal Materials Co | Aker Technology vs. Provision Information CoLtd | Aker Technology vs. Eagle Cold Storage | Aker Technology vs. Data International Co |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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