Correlation Between Africa Oil and Lite Access
Can any of the company-specific risk be diversified away by investing in both Africa Oil and Lite Access 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 Africa Oil and Lite Access into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Africa Oil Corp and Lite Access Technologies, you can compare the effects of market volatilities on Africa Oil and Lite Access 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 Africa Oil with a short position of Lite Access. Check out your portfolio center. Please also check ongoing floating volatility patterns of Africa Oil and Lite Access.
Diversification Opportunities for Africa Oil and Lite Access
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Africa and Lite is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Africa Oil Corp and Lite Access Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lite Access Technologies and Africa Oil 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 Africa Oil Corp are associated (or correlated) with Lite Access. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lite Access Technologies has no effect on the direction of Africa Oil i.e., Africa Oil and Lite Access go up and down completely randomly.
Pair Corralation between Africa Oil and Lite Access
If you would invest 9.50 in Lite Access Technologies on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Lite Access Technologies or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Africa Oil Corp vs. Lite Access Technologies
Performance |
| Timeline |
| Africa Oil Corp |
| Lite Access Technologies |
Africa Oil and Lite Access Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Africa Oil and Lite Access
The main advantage of trading using opposite Africa Oil and Lite Access positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Africa Oil position performs unexpectedly, Lite Access 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 Lite Access will offset losses from the drop in Lite Access' long position.The idea behind Africa Oil Corp and Lite Access Technologies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Lite Access vs. Braille Energy Systems | Lite Access vs. Manganese X Energy | Lite Access vs. Solar Alliance Energy | Lite Access vs. Therma Bright |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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