Correlation Between Aspen Group and Green Technology
Can any of the company-specific risk be diversified away by investing in both Aspen Group and Green Technology 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 Aspen Group and Green Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aspen Group Unit and Green Technology Metals, you can compare the effects of market volatilities on Aspen Group and Green Technology 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 Aspen Group with a short position of Green Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspen Group and Green Technology.
Diversification Opportunities for Aspen Group and Green Technology
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aspen and Green is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Aspen Group Unit and Green Technology Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green Technology Metals and Aspen Group 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 Aspen Group Unit are associated (or correlated) with Green Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green Technology Metals has no effect on the direction of Aspen Group i.e., Aspen Group and Green Technology go up and down completely randomly.
Pair Corralation between Aspen Group and Green Technology
Assuming the 90 days trading horizon Aspen Group Unit is expected to generate 0.42 times more return on investment than Green Technology. However, Aspen Group Unit is 2.4 times less risky than Green Technology. It trades about 0.17 of its potential returns per unit of risk. Green Technology Metals is currently generating about -0.04 per unit of risk. If you would invest 172.00 in Aspen Group Unit on September 3, 2024 and sell it today you would earn a total of 87.00 from holding Aspen Group Unit or generate 50.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aspen Group Unit vs. Green Technology Metals
Performance |
| Timeline |
| Aspen Group Unit |
| Green Technology Metals |
Aspen Group and Green Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aspen Group and Green Technology
The main advantage of trading using opposite Aspen Group and Green Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aspen Group position performs unexpectedly, Green Technology 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 Green Technology will offset losses from the drop in Green Technology's long position.| Aspen Group vs. Perseus Mining | Aspen Group vs. Step One Clothing | Aspen Group vs. Singular Health Group | Aspen Group vs. MetalsGrove Mining |
| Green Technology vs. Northern Star Resources | Green Technology vs. Evolution Mining | Green Technology vs. Bluescope Steel | Green Technology vs. Aneka Tambang Tbk |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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