Correlation Between AIM Industrial and Gunkul Engineering
Can any of the company-specific risk be diversified away by investing in both AIM Industrial and Gunkul Engineering 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 AIM Industrial and Gunkul Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AIM Industrial Growth and Gunkul Engineering Public, you can compare the effects of market volatilities on AIM Industrial and Gunkul Engineering 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 AIM Industrial with a short position of Gunkul Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIM Industrial and Gunkul Engineering.
Diversification Opportunities for AIM Industrial and Gunkul Engineering
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AIM and Gunkul is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding AIM Industrial Growth and Gunkul Engineering Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gunkul Engineering Public and AIM Industrial 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 AIM Industrial Growth are associated (or correlated) with Gunkul Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gunkul Engineering Public has no effect on the direction of AIM Industrial i.e., AIM Industrial and Gunkul Engineering go up and down completely randomly.
Pair Corralation between AIM Industrial and Gunkul Engineering
Assuming the 90 days trading horizon AIM Industrial Growth is expected to generate 0.3 times more return on investment than Gunkul Engineering. However, AIM Industrial Growth is 3.39 times less risky than Gunkul Engineering. It trades about 0.0 of its potential returns per unit of risk. Gunkul Engineering Public is currently generating about -0.23 per unit of risk. If you would invest 1,050 in AIM Industrial Growth on October 22, 2024 and sell it today you would earn a total of 0.00 from holding AIM Industrial Growth or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
AIM Industrial Growth vs. Gunkul Engineering Public
Performance |
| Timeline |
| AIM Industrial Growth |
| Gunkul Engineering Public |
AIM Industrial and Gunkul Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIM Industrial and Gunkul Engineering
The main advantage of trading using opposite AIM Industrial and Gunkul Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIM Industrial position performs unexpectedly, Gunkul Engineering 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 Gunkul Engineering will offset losses from the drop in Gunkul Engineering's long position.| AIM Industrial vs. Amata Summit Growth | AIM Industrial vs. WHA Premium Growth | AIM Industrial vs. Digital Telecommunications Infrastructure | AIM Industrial vs. Quality Houses Property |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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