Correlation Between AT S and Vicor
Can any of the company-specific risk be diversified away by investing in both AT S and Vicor 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 AT S and Vicor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AT S Austria and Vicor, you can compare the effects of market volatilities on AT S and Vicor 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 AT S with a short position of Vicor. Check out your portfolio center. Please also check ongoing floating volatility patterns of AT S and Vicor.
Diversification Opportunities for AT S and Vicor
Modest diversification
The 3 months correlation between ASAAF and Vicor is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding AT S Austria and Vicor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vicor and AT S 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 AT S Austria are associated (or correlated) with Vicor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vicor has no effect on the direction of AT S i.e., AT S and Vicor go up and down completely randomly.
Pair Corralation between AT S and Vicor
Assuming the 90 days horizon AT S Austria is expected to under-perform the Vicor. In addition to that, AT S is 1.05 times more volatile than Vicor. It trades about -0.07 of its total potential returns per unit of risk. Vicor is currently generating about 0.05 per unit of volatility. If you would invest 3,873 in Vicor on November 5, 2024 and sell it today you would earn a total of 1,241 from holding Vicor or generate 32.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AT S Austria vs. Vicor
Performance |
| Timeline |
| AT S Austria |
| Vicor |
AT S and Vicor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AT S and Vicor
The main advantage of trading using opposite AT S and Vicor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AT S position performs unexpectedly, Vicor 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 Vicor will offset losses from the drop in Vicor's long position.The idea behind AT S Austria and Vicor 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.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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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