Correlation Between ABSOLUTE CLEAN and Asia Biomass
Can any of the company-specific risk be diversified away by investing in both ABSOLUTE CLEAN and Asia Biomass 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 ABSOLUTE CLEAN and Asia Biomass into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABSOLUTE CLEAN ENERGY and Asia Biomass Public, you can compare the effects of market volatilities on ABSOLUTE CLEAN and Asia Biomass 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 ABSOLUTE CLEAN with a short position of Asia Biomass. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABSOLUTE CLEAN and Asia Biomass.
Diversification Opportunities for ABSOLUTE CLEAN and Asia Biomass
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between ABSOLUTE and Asia is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding ABSOLUTE CLEAN ENERGY and Asia Biomass Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Biomass Public and ABSOLUTE CLEAN 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 ABSOLUTE CLEAN ENERGY are associated (or correlated) with Asia Biomass. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Biomass Public has no effect on the direction of ABSOLUTE CLEAN i.e., ABSOLUTE CLEAN and Asia Biomass go up and down completely randomly.
Pair Corralation between ABSOLUTE CLEAN and Asia Biomass
Assuming the 90 days trading horizon ABSOLUTE CLEAN ENERGY is expected to under-perform the Asia Biomass. In addition to that, ABSOLUTE CLEAN is 9.68 times more volatile than Asia Biomass Public. It trades about -0.18 of its total potential returns per unit of risk. Asia Biomass Public is currently generating about 0.05 per unit of volatility. If you would invest 129.00 in Asia Biomass Public on September 1, 2024 and sell it today you would earn a total of 1.00 from holding Asia Biomass Public or generate 0.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
ABSOLUTE CLEAN ENERGY vs. Asia Biomass Public
Performance |
| Timeline |
| ABSOLUTE CLEAN ENERGY |
| Asia Biomass Public |
ABSOLUTE CLEAN and Asia Biomass Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABSOLUTE CLEAN and Asia Biomass
The main advantage of trading using opposite ABSOLUTE CLEAN and Asia Biomass positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABSOLUTE CLEAN position performs unexpectedly, Asia Biomass 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 Asia Biomass will offset losses from the drop in Asia Biomass' long position.| ABSOLUTE CLEAN vs. Asia Biomass Public | ABSOLUTE CLEAN vs. JCK Hospitality Public | ABSOLUTE CLEAN vs. JCK International Public | ABSOLUTE CLEAN vs. Green Resources Public |
| Asia Biomass vs. Akkhie Prakarn Public | Asia Biomass vs. AIRA Factoring Public | Asia Biomass vs. G Capital Public | Asia Biomass vs. Asia Green Energy |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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