Correlation Between AdvanceTC and Wialan Technologies
Can any of the company-specific risk be diversified away by investing in both AdvanceTC and Wialan Technologies 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 AdvanceTC and Wialan Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AdvanceTC Limited and Wialan Technologies, you can compare the effects of market volatilities on AdvanceTC and Wialan Technologies 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 AdvanceTC with a short position of Wialan Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of AdvanceTC and Wialan Technologies.
Diversification Opportunities for AdvanceTC and Wialan Technologies
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AdvanceTC and Wialan is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding AdvanceTC Limited and Wialan Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wialan Technologies and AdvanceTC 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 AdvanceTC Limited are associated (or correlated) with Wialan Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wialan Technologies has no effect on the direction of AdvanceTC i.e., AdvanceTC and Wialan Technologies go up and down completely randomly.
Pair Corralation between AdvanceTC and Wialan Technologies
Assuming the 90 days horizon AdvanceTC Limited is expected to generate 27.87 times more return on investment than Wialan Technologies. However, AdvanceTC is 27.87 times more volatile than Wialan Technologies. It trades about 0.22 of its potential returns per unit of risk. Wialan Technologies is currently generating about -0.14 per unit of risk. If you would invest 0.01 in AdvanceTC Limited on November 4, 2024 and sell it today you would earn a total of 0.99 from holding AdvanceTC Limited or generate 9900.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
AdvanceTC Limited vs. Wialan Technologies
Performance |
| Timeline |
| AdvanceTC Limited |
| Wialan Technologies |
AdvanceTC and Wialan Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AdvanceTC and Wialan Technologies
The main advantage of trading using opposite AdvanceTC and Wialan Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AdvanceTC position performs unexpectedly, Wialan Technologies 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 Wialan Technologies will offset losses from the drop in Wialan Technologies' long position.The idea behind AdvanceTC Limited and Wialan Technologies 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.| Wialan Technologies vs. Genesis Electronics Group | Wialan Technologies vs. Global Develpmts | Wialan Technologies vs. XCPCNL Business Services | Wialan Technologies vs. TonnerOne World Holdings |
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 CEOs Directory module to screen CEOs from public companies around the world.
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