Correlation Between Ambertech and 4Dmedical
Can any of the company-specific risk be diversified away by investing in both Ambertech and 4Dmedical 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 Ambertech and 4Dmedical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ambertech and 4Dmedical, you can compare the effects of market volatilities on Ambertech and 4Dmedical 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 Ambertech with a short position of 4Dmedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambertech and 4Dmedical.
Diversification Opportunities for Ambertech and 4Dmedical
Good diversification
The 3 months correlation between Ambertech and 4Dmedical is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Ambertech and 4Dmedical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 4Dmedical and Ambertech 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 Ambertech are associated (or correlated) with 4Dmedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 4Dmedical has no effect on the direction of Ambertech i.e., Ambertech and 4Dmedical go up and down completely randomly.
Pair Corralation between Ambertech and 4Dmedical
Assuming the 90 days trading horizon Ambertech is expected to generate 22.72 times less return on investment than 4Dmedical. But when comparing it to its historical volatility, Ambertech is 1.56 times less risky than 4Dmedical. It trades about 0.02 of its potential returns per unit of risk. 4Dmedical is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 46.00 in 4Dmedical on October 28, 2024 and sell it today you would earn a total of 14.00 from holding 4Dmedical or generate 30.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ambertech vs. 4Dmedical
Performance |
| Timeline |
| Ambertech |
| 4Dmedical |
Ambertech and 4Dmedical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ambertech and 4Dmedical
The main advantage of trading using opposite Ambertech and 4Dmedical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambertech position performs unexpectedly, 4Dmedical 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 4Dmedical will offset losses from the drop in 4Dmedical's long position.| Ambertech vs. Aneka Tambang Tbk | Ambertech vs. BHP Group Limited | Ambertech vs. Rio Tinto | Ambertech vs. Macquarie Group Ltd |
| 4Dmedical vs. Sonic Healthcare | 4Dmedical vs. My Foodie Box | 4Dmedical vs. Regis Healthcare | 4Dmedical vs. Oneview Healthcare 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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