Correlation Between Astar and N2Tech
Can any of the company-specific risk be diversified away by investing in both Astar and N2Tech 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 Astar and N2Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astar and N2Tech Co, you can compare the effects of market volatilities on Astar and N2Tech 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 Astar with a short position of N2Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astar and N2Tech.
Diversification Opportunities for Astar and N2Tech
Modest diversification
The 3 months correlation between Astar and N2Tech is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Astar and N2Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on N2Tech and Astar 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 Astar are associated (or correlated) with N2Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of N2Tech has no effect on the direction of Astar i.e., Astar and N2Tech go up and down completely randomly.
Pair Corralation between Astar and N2Tech
Assuming the 90 days trading horizon Astar is expected to under-perform the N2Tech. In addition to that, Astar is 3.95 times more volatile than N2Tech Co. It trades about -0.13 of its total potential returns per unit of risk. N2Tech Co is currently generating about 0.04 per unit of volatility. If you would invest 45,000 in N2Tech Co on October 14, 2024 and sell it today you would earn a total of 400.00 from holding N2Tech Co or generate 0.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Astar vs. N2Tech Co
Performance |
| Timeline |
| Astar |
| N2Tech |
Astar and N2Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astar and N2Tech
The main advantage of trading using opposite Astar and N2Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astar position performs unexpectedly, N2Tech 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 N2Tech will offset losses from the drop in N2Tech's long position.The idea behind Astar and N2Tech Co 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.| N2Tech vs. Iljin Display | N2Tech vs. Chorokbaem Healthcare Co | N2Tech vs. Infinitt Healthcare Co | N2Tech vs. INFINITT Healthcare Co |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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