Correlation Between Auction Technology and Argen X
Can any of the company-specific risk be diversified away by investing in both Auction Technology and Argen X 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 Auction Technology and Argen X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auction Technology Group and Argen X, you can compare the effects of market volatilities on Auction Technology and Argen X 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 Auction Technology with a short position of Argen X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auction Technology and Argen X.
Diversification Opportunities for Auction Technology and Argen X
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Auction and Argen is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Auction Technology Group and Argen X in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argen X and Auction Technology 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 Auction Technology Group are associated (or correlated) with Argen X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argen X has no effect on the direction of Auction Technology i.e., Auction Technology and Argen X go up and down completely randomly.
Pair Corralation between Auction Technology and Argen X
Assuming the 90 days trading horizon Auction Technology is expected to generate 10.06 times less return on investment than Argen X. In addition to that, Auction Technology is 1.72 times more volatile than Argen X. It trades about 0.01 of its total potential returns per unit of risk. Argen X is currently generating about 0.17 per unit of volatility. If you would invest 42,050 in Argen X on September 23, 2024 and sell it today you would earn a total of 17,820 from holding Argen X or generate 42.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auction Technology Group vs. Argen X
Performance |
| Timeline |
| Auction Technology |
| Argen X |
Auction Technology and Argen X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auction Technology and Argen X
The main advantage of trading using opposite Auction Technology and Argen X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auction Technology position performs unexpectedly, Argen X 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 Argen X will offset losses from the drop in Argen X's long position.| Auction Technology vs. Samsung Electronics Co | Auction Technology vs. Samsung Electronics Co | Auction Technology vs. Hyundai Motor | Auction Technology vs. Toyota Motor Corp |
| Argen X vs. Auction Technology Group | Argen X vs. Premier Foods PLC | Argen X vs. Sabre Insurance Group | Argen X vs. UNIQA Insurance 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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