Correlation Between AAC Clyde and SolTech Energy
Can any of the company-specific risk be diversified away by investing in both AAC Clyde and SolTech Energy 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 Clyde and SolTech Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AAC Clyde Space and SolTech Energy Sweden, you can compare the effects of market volatilities on AAC Clyde and SolTech Energy 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 Clyde with a short position of SolTech Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of AAC Clyde and SolTech Energy.
Diversification Opportunities for AAC Clyde and SolTech Energy
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AAC and SolTech is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding AAC Clyde Space and SolTech Energy Sweden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SolTech Energy Sweden and AAC Clyde 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 Clyde Space are associated (or correlated) with SolTech Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SolTech Energy Sweden has no effect on the direction of AAC Clyde i.e., AAC Clyde and SolTech Energy go up and down completely randomly.
Pair Corralation between AAC Clyde and SolTech Energy
Assuming the 90 days trading horizon AAC Clyde Space is expected to generate 1.32 times more return on investment than SolTech Energy. However, AAC Clyde is 1.32 times more volatile than SolTech Energy Sweden. It trades about 0.21 of its potential returns per unit of risk. SolTech Energy Sweden is currently generating about -0.26 per unit of risk. If you would invest 3,580 in AAC Clyde Space on August 31, 2024 and sell it today you would earn a total of 990.00 from holding AAC Clyde Space or generate 27.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
AAC Clyde Space vs. SolTech Energy Sweden
Performance |
| Timeline |
| AAC Clyde Space |
| SolTech Energy Sweden |
AAC Clyde and SolTech Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AAC Clyde and SolTech Energy
The main advantage of trading using opposite AAC Clyde and SolTech Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AAC Clyde position performs unexpectedly, SolTech Energy 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 SolTech Energy will offset losses from the drop in SolTech Energy's long position.| AAC Clyde vs. Saab AB | AAC Clyde vs. CTT Systems AB | AAC Clyde vs. W5 Solutions AB | AAC Clyde vs. AVTECH Sweden AB |
| SolTech Energy vs. Eolus Vind AB | SolTech Energy vs. Sinch AB | SolTech Energy vs. Embracer Group AB | SolTech Energy vs. Powercell Sweden |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |