Correlation Between Alpha En and Neonode
Can any of the company-specific risk be diversified away by investing in both Alpha En and Neonode 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 Alpha En and Neonode into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between alpha En and Neonode, you can compare the effects of market volatilities on Alpha En and Neonode 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 Alpha En with a short position of Neonode. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha En and Neonode.
Diversification Opportunities for Alpha En and Neonode
Poor diversification
The 3 months correlation between Alpha and Neonode is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding alpha En and Neonode in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neonode and Alpha En 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 alpha En are associated (or correlated) with Neonode. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neonode has no effect on the direction of Alpha En i.e., Alpha En and Neonode go up and down completely randomly.
Pair Corralation between Alpha En and Neonode
Given the investment horizon of 90 days alpha En is expected to generate 6.21 times more return on investment than Neonode. However, Alpha En is 6.21 times more volatile than Neonode. It trades about 0.21 of its potential returns per unit of risk. Neonode is currently generating about 0.1 per unit of risk. If you would invest 0.01 in alpha En on November 28, 2024 and sell it today you would earn a total of 0.01 from holding alpha En or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
alpha En vs. Neonode
Performance |
| Timeline |
| alpha En |
| Neonode |
Alpha En and Neonode Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alpha En and Neonode
The main advantage of trading using opposite Alpha En and Neonode positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alpha En position performs unexpectedly, Neonode 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 Neonode will offset losses from the drop in Neonode's long position.| Alpha En vs. Alps Electric Co | Alpha En vs. Bitmine Immersion Technologies | Alpha En vs. American Aires | Alpha En vs. AT S Austria |
| Neonode vs. LightPath Technologies | Neonode vs. Methode Electronics | Neonode vs. OSI Systems | Neonode vs. Plexus Corp |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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