Correlation Between ASM Pacific and MARKET VECTR
Can any of the company-specific risk be diversified away by investing in both ASM Pacific and MARKET VECTR 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 ASM Pacific and MARKET VECTR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASM Pacific Technology and MARKET VECTR RETAIL, you can compare the effects of market volatilities on ASM Pacific and MARKET VECTR 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 ASM Pacific with a short position of MARKET VECTR. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASM Pacific and MARKET VECTR.
Diversification Opportunities for ASM Pacific and MARKET VECTR
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ASM and MARKET is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding ASM Pacific Technology and MARKET VECTR RETAIL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MARKET VECTR RETAIL and ASM Pacific 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 ASM Pacific Technology are associated (or correlated) with MARKET VECTR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MARKET VECTR RETAIL has no effect on the direction of ASM Pacific i.e., ASM Pacific and MARKET VECTR go up and down completely randomly.
Pair Corralation between ASM Pacific and MARKET VECTR
Assuming the 90 days trading horizon ASM Pacific is expected to generate 2.12 times less return on investment than MARKET VECTR. In addition to that, ASM Pacific is 5.14 times more volatile than MARKET VECTR RETAIL. It trades about 0.01 of its total potential returns per unit of risk. MARKET VECTR RETAIL is currently generating about 0.12 per unit of volatility. If you would invest 18,416 in MARKET VECTR RETAIL on November 3, 2024 and sell it today you would earn a total of 4,724 from holding MARKET VECTR RETAIL or generate 25.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.8% |
| Values | Daily Returns |
ASM Pacific Technology vs. MARKET VECTR RETAIL
Performance |
| Timeline |
| ASM Pacific Technology |
| MARKET VECTR RETAIL |
ASM Pacific and MARKET VECTR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASM Pacific and MARKET VECTR
The main advantage of trading using opposite ASM Pacific and MARKET VECTR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASM Pacific position performs unexpectedly, MARKET VECTR 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 MARKET VECTR will offset losses from the drop in MARKET VECTR's long position.| ASM Pacific vs. Safety Insurance Group | ASM Pacific vs. Direct Line Insurance | ASM Pacific vs. REVO INSURANCE SPA | ASM Pacific vs. NURAN WIRELESS INC |
| MARKET VECTR vs. Pebblebrook Hotel Trust | MARKET VECTR vs. Computershare Limited | MARKET VECTR vs. BRAEMAR HOTELS RES | MARKET VECTR vs. Park Hotels Resorts |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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