Correlation Between AAC TECHNOLOGHLDGADR and Boyaa Interactive
Can any of the company-specific risk be diversified away by investing in both AAC TECHNOLOGHLDGADR and Boyaa Interactive 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 AAC TECHNOLOGHLDGADR and Boyaa Interactive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AAC TECHNOLOGHLDGADR and Boyaa Interactive International, you can compare the effects of market volatilities on AAC TECHNOLOGHLDGADR and Boyaa Interactive 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 AAC TECHNOLOGHLDGADR with a short position of Boyaa Interactive. Check out your portfolio center. Please also check ongoing floating volatility patterns of AAC TECHNOLOGHLDGADR and Boyaa Interactive.
Diversification Opportunities for AAC TECHNOLOGHLDGADR and Boyaa Interactive
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AAC and Boyaa is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding AAC TECHNOLOGHLDGADR and Boyaa Interactive Internationa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boyaa Interactive and AAC TECHNOLOGHLDGADR 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 AAC TECHNOLOGHLDGADR are associated (or correlated) with Boyaa Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boyaa Interactive has no effect on the direction of AAC TECHNOLOGHLDGADR i.e., AAC TECHNOLOGHLDGADR and Boyaa Interactive go up and down completely randomly.
Pair Corralation between AAC TECHNOLOGHLDGADR and Boyaa Interactive
Assuming the 90 days horizon AAC TECHNOLOGHLDGADR is expected to generate 7.87 times less return on investment than Boyaa Interactive. But when comparing it to its historical volatility, AAC TECHNOLOGHLDGADR is 2.58 times less risky than Boyaa Interactive. It trades about 0.2 of its potential returns per unit of risk. Boyaa Interactive International is currently generating about 0.6 of returns per unit of risk over similar time horizon. If you would invest 18.00 in Boyaa Interactive International on August 26, 2024 and sell it today you would earn a total of 35.00 from holding Boyaa Interactive International or generate 194.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AAC TECHNOLOGHLDGADR vs. Boyaa Interactive Internationa
Performance |
| Timeline |
| AAC TECHNOLOGHLDGADR |
| Boyaa Interactive |
AAC TECHNOLOGHLDGADR and Boyaa Interactive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AAC TECHNOLOGHLDGADR and Boyaa Interactive
The main advantage of trading using opposite AAC TECHNOLOGHLDGADR and Boyaa Interactive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AAC TECHNOLOGHLDGADR position performs unexpectedly, Boyaa Interactive 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 Boyaa Interactive will offset losses from the drop in Boyaa Interactive's long position.| AAC TECHNOLOGHLDGADR vs. Cisco Systems | AAC TECHNOLOGHLDGADR vs. Telefonaktiebolaget LM Ericsson | AAC TECHNOLOGHLDGADR vs. Superior Plus Corp | AAC TECHNOLOGHLDGADR vs. NMI Holdings |
| Boyaa Interactive vs. AAC TECHNOLOGHLDGADR | Boyaa Interactive vs. Uber Technologies | Boyaa Interactive vs. Digilife Technologies Limited | Boyaa Interactive vs. Norwegian Air Shuttle |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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