Correlation Between Anterix and RLX Technology
Can any of the company-specific risk be diversified away by investing in both Anterix and RLX Technology 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 Anterix and RLX Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anterix and RLX Technology, you can compare the effects of market volatilities on Anterix and RLX Technology 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 Anterix with a short position of RLX Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anterix and RLX Technology.
Diversification Opportunities for Anterix and RLX Technology
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Anterix and RLX is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Anterix and RLX Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RLX Technology and Anterix 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 Anterix are associated (or correlated) with RLX Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RLX Technology has no effect on the direction of Anterix i.e., Anterix and RLX Technology go up and down completely randomly.
Pair Corralation between Anterix and RLX Technology
Given the investment horizon of 90 days Anterix is expected to generate 7.36 times less return on investment than RLX Technology. But when comparing it to its historical volatility, Anterix is 1.05 times less risky than RLX Technology. It trades about 0.05 of its potential returns per unit of risk. RLX Technology is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 162.00 in RLX Technology on September 4, 2024 and sell it today you would earn a total of 35.00 from holding RLX Technology or generate 21.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anterix vs. RLX Technology
Performance |
| Timeline |
| Anterix |
| RLX Technology |
Anterix and RLX Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anterix and RLX Technology
The main advantage of trading using opposite Anterix and RLX Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anterix position performs unexpectedly, RLX Technology 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 RLX Technology will offset losses from the drop in RLX Technology's long position.| Anterix vs. Shenandoah Telecommunications Co | Anterix vs. Liberty Broadband Corp | Anterix vs. Ooma Inc | Anterix vs. IDT Corporation |
| RLX Technology vs. Green Globe International | RLX Technology vs. Kaival Brands Innovations | RLX Technology vs. Greenlane Holdings | RLX Technology vs. 22nd Century 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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