Correlation Between AAC TECHNOLOGHLDGADR and Greencoat
Can any of the company-specific risk be diversified away by investing in both AAC TECHNOLOGHLDGADR and Greencoat 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 Greencoat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AAC TECHNOLOGHLDGADR and Greencoat UK Wind, you can compare the effects of market volatilities on AAC TECHNOLOGHLDGADR and Greencoat 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 Greencoat. Check out your portfolio center. Please also check ongoing floating volatility patterns of AAC TECHNOLOGHLDGADR and Greencoat.
Diversification Opportunities for AAC TECHNOLOGHLDGADR and Greencoat
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AAC and Greencoat is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding AAC TECHNOLOGHLDGADR and Greencoat UK Wind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greencoat UK Wind 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 Greencoat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greencoat UK Wind has no effect on the direction of AAC TECHNOLOGHLDGADR i.e., AAC TECHNOLOGHLDGADR and Greencoat go up and down completely randomly.
Pair Corralation between AAC TECHNOLOGHLDGADR and Greencoat
Assuming the 90 days horizon AAC TECHNOLOGHLDGADR is expected to generate 1.17 times more return on investment than Greencoat. However, AAC TECHNOLOGHLDGADR is 1.17 times more volatile than Greencoat UK Wind. It trades about 0.07 of its potential returns per unit of risk. Greencoat UK Wind is currently generating about 0.02 per unit of risk. If you would invest 193.00 in AAC TECHNOLOGHLDGADR on September 14, 2024 and sell it today you would earn a total of 267.00 from holding AAC TECHNOLOGHLDGADR or generate 138.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
AAC TECHNOLOGHLDGADR vs. Greencoat UK Wind
Performance |
| Timeline |
| AAC TECHNOLOGHLDGADR |
| Greencoat UK Wind |
AAC TECHNOLOGHLDGADR and Greencoat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AAC TECHNOLOGHLDGADR and Greencoat
The main advantage of trading using opposite AAC TECHNOLOGHLDGADR and Greencoat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AAC TECHNOLOGHLDGADR position performs unexpectedly, Greencoat 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 Greencoat will offset losses from the drop in Greencoat's long position.| AAC TECHNOLOGHLDGADR vs. Cisco Systems | AAC TECHNOLOGHLDGADR vs. Nokia | AAC TECHNOLOGHLDGADR vs. Superior Plus Corp | AAC TECHNOLOGHLDGADR vs. SIVERS SEMICONDUCTORS AB |
| Greencoat vs. AAC TECHNOLOGHLDGADR | Greencoat vs. Zijin Mining Group | Greencoat vs. BJs Restaurants | Greencoat vs. SERI INDUSTRIAL EO |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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