Correlation Between LAir Liquide and AOI Electronics
Can any of the company-specific risk be diversified away by investing in both LAir Liquide and AOI Electronics 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 LAir Liquide and AOI Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LAir Liquide SA and AOI Electronics Co, you can compare the effects of market volatilities on LAir Liquide and AOI Electronics 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 LAir Liquide with a short position of AOI Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of LAir Liquide and AOI Electronics.
Diversification Opportunities for LAir Liquide and AOI Electronics
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between LAir and AOI is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding LAir Liquide SA and AOI Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AOI Electronics and LAir Liquide 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 LAir Liquide SA are associated (or correlated) with AOI Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AOI Electronics has no effect on the direction of LAir Liquide i.e., LAir Liquide and AOI Electronics go up and down completely randomly.
Pair Corralation between LAir Liquide and AOI Electronics
If you would invest 12,108 in LAir Liquide SA on August 29, 2024 and sell it today you would earn a total of 3,586 from holding LAir Liquide SA or generate 29.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
LAir Liquide SA vs. AOI Electronics Co
Performance |
| Timeline |
| LAir Liquide SA |
| AOI Electronics |
LAir Liquide and AOI Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LAir Liquide and AOI Electronics
The main advantage of trading using opposite LAir Liquide and AOI Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LAir Liquide position performs unexpectedly, AOI Electronics 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 AOI Electronics will offset losses from the drop in AOI Electronics' long position.| LAir Liquide vs. Apple Inc | LAir Liquide vs. Apple Inc | LAir Liquide vs. Apple Inc | LAir Liquide vs. Apple Inc |
| AOI Electronics vs. NVIDIA | AOI Electronics vs. Taiwan Semiconductor Manufacturing | AOI Electronics vs. Texas Instruments Incorporated | AOI Electronics vs. Advanced Micro Devices |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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