Correlation Between Aspen Aerogels and SPX Corp
Can any of the company-specific risk be diversified away by investing in both Aspen Aerogels and SPX Corp 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 Aerogels and SPX Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aspen Aerogels and SPX Corp, you can compare the effects of market volatilities on Aspen Aerogels and SPX Corp 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 Aerogels with a short position of SPX Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspen Aerogels and SPX Corp.
Diversification Opportunities for Aspen Aerogels and SPX Corp
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aspen and SPX is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Aspen Aerogels and SPX Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPX Corp and Aspen Aerogels 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 Aerogels are associated (or correlated) with SPX Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPX Corp has no effect on the direction of Aspen Aerogels i.e., Aspen Aerogels and SPX Corp go up and down completely randomly.
Pair Corralation between Aspen Aerogels and SPX Corp
Given the investment horizon of 90 days Aspen Aerogels is expected to under-perform the SPX Corp. In addition to that, Aspen Aerogels is 2.04 times more volatile than SPX Corp. It trades about -0.08 of its total potential returns per unit of risk. SPX Corp is currently generating about 0.09 per unit of volatility. If you would invest 13,636 in SPX Corp on September 1, 2024 and sell it today you would earn a total of 4,008 from holding SPX Corp or generate 29.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aspen Aerogels vs. SPX Corp
Performance |
| Timeline |
| Aspen Aerogels |
| SPX Corp |
Aspen Aerogels and SPX Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aspen Aerogels and SPX Corp
The main advantage of trading using opposite Aspen Aerogels and SPX Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aspen Aerogels position performs unexpectedly, SPX Corp 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 SPX Corp will offset losses from the drop in SPX Corp's long position.| Aspen Aerogels vs. Apyx Medical | Aspen Aerogels vs. Century Communities | Aspen Aerogels vs. Ardmore Shpng | Aspen Aerogels vs. American Assets Trust |
| SPX Corp vs. Standex International | SPX Corp vs. Enpro Industries | SPX Corp vs. Thermon Group Holdings | SPX Corp vs. Enerpac Tool Group |
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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