Correlation Between Aeries Technology and LithiumBank Resources
Can any of the company-specific risk be diversified away by investing in both Aeries Technology and LithiumBank Resources 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 Aeries Technology and LithiumBank Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aeries Technology and LithiumBank Resources Corp, you can compare the effects of market volatilities on Aeries Technology and LithiumBank Resources 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 Aeries Technology with a short position of LithiumBank Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aeries Technology and LithiumBank Resources.
Diversification Opportunities for Aeries Technology and LithiumBank Resources
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aeries and LithiumBank is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Aeries Technology and LithiumBank Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LithiumBank Resources and Aeries Technology 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 Aeries Technology are associated (or correlated) with LithiumBank Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LithiumBank Resources has no effect on the direction of Aeries Technology i.e., Aeries Technology and LithiumBank Resources go up and down completely randomly.
Pair Corralation between Aeries Technology and LithiumBank Resources
Assuming the 90 days horizon Aeries Technology is expected to generate 4.75 times more return on investment than LithiumBank Resources. However, Aeries Technology is 4.75 times more volatile than LithiumBank Resources Corp. It trades about 0.03 of its potential returns per unit of risk. LithiumBank Resources Corp is currently generating about -0.03 per unit of risk. If you would invest 13.00 in Aeries Technology on September 3, 2024 and sell it today you would lose (9.49) from holding Aeries Technology or give up 73.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 21.21% |
| Values | Daily Returns |
Aeries Technology vs. LithiumBank Resources Corp
Performance |
| Timeline |
| Aeries Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| LithiumBank Resources |
Aeries Technology and LithiumBank Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aeries Technology and LithiumBank Resources
The main advantage of trading using opposite Aeries Technology and LithiumBank Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aeries Technology position performs unexpectedly, LithiumBank Resources 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 LithiumBank Resources will offset losses from the drop in LithiumBank Resources' long position.| Aeries Technology vs. LithiumBank Resources Corp | Aeries Technology vs. Equinix | Aeries Technology vs. Barings BDC | Aeries Technology vs. Sabra Healthcare REIT |
| LithiumBank Resources vs. Qubec Nickel Corp | LithiumBank Resources vs. IGO Limited | LithiumBank Resources vs. Avarone Metals | LithiumBank Resources vs. Adriatic Metals PLC |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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