Correlation Between Allied Motion and Bel Fuse
Can any of the company-specific risk be diversified away by investing in both Allied Motion and Bel Fuse 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 Allied Motion and Bel Fuse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allied Motion Technologies and Bel Fuse A, you can compare the effects of market volatilities on Allied Motion and Bel Fuse 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 Allied Motion with a short position of Bel Fuse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allied Motion and Bel Fuse.
Diversification Opportunities for Allied Motion and Bel Fuse
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Allied and Bel is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Allied Motion Technologies and Bel Fuse A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bel Fuse A and Allied Motion 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 Allied Motion Technologies are associated (or correlated) with Bel Fuse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bel Fuse A has no effect on the direction of Allied Motion i.e., Allied Motion and Bel Fuse go up and down completely randomly.
Pair Corralation between Allied Motion and Bel Fuse
If you would invest 3,917 in Allied Motion Technologies on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Allied Motion Technologies or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Allied Motion Technologies vs. Bel Fuse A
Performance |
| Timeline |
| Allied Motion Techno |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Bel Fuse A |
Allied Motion and Bel Fuse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allied Motion and Bel Fuse
The main advantage of trading using opposite Allied Motion and Bel Fuse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allied Motion position performs unexpectedly, Bel Fuse 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 Bel Fuse will offset losses from the drop in Bel Fuse's long position.| Allied Motion vs. Plexus Corp | Allied Motion vs. Sanmina | Allied Motion vs. Bel Fuse A | Allied Motion vs. Methode Electronics |
| Bel Fuse vs. Richardson Electronics | Bel Fuse vs. LSI Industries | Bel Fuse vs. Benchmark Electronics | Bel Fuse 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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