Correlation Between Aspen Aerogels and Latham
Can any of the company-specific risk be diversified away by investing in both Aspen Aerogels and Latham 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 Latham into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aspen Aerogels and Latham Group, you can compare the effects of market volatilities on Aspen Aerogels and Latham 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 Latham. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspen Aerogels and Latham.
Diversification Opportunities for Aspen Aerogels and Latham
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aspen and Latham is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Aspen Aerogels and Latham Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Latham Group 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 Latham. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Latham Group has no effect on the direction of Aspen Aerogels i.e., Aspen Aerogels and Latham go up and down completely randomly.
Pair Corralation between Aspen Aerogels and Latham
Given the investment horizon of 90 days Aspen Aerogels is expected to generate 4.41 times less return on investment than Latham. In addition to that, Aspen Aerogels is 1.08 times more volatile than Latham Group. It trades about 0.02 of its total potential returns per unit of risk. Latham Group is currently generating about 0.1 per unit of volatility. If you would invest 234.00 in Latham Group on November 9, 2024 and sell it today you would earn a total of 471.00 from holding Latham Group or generate 201.28% 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. Latham Group
Performance |
| Timeline |
| Aspen Aerogels |
| Latham Group |
Aspen Aerogels and Latham Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aspen Aerogels and Latham
The main advantage of trading using opposite Aspen Aerogels and Latham positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aspen Aerogels position performs unexpectedly, Latham 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 Latham will offset losses from the drop in Latham's long position.| Aspen Aerogels vs. Apyx Medical | Aspen Aerogels vs. Century Communities | Aspen Aerogels vs. Ardmore Shpng | Aspen Aerogels vs. American Assets Trust |
| Latham vs. Great Western Minerals | Latham vs. Enterprise Bancorp | Latham vs. T Rowe Price | Latham vs. Aviat Networks |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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