Correlation Between Chardan NexTech and ADS TEC
Can any of the company-specific risk be diversified away by investing in both Chardan NexTech and ADS TEC 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 Chardan NexTech and ADS TEC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chardan NexTech Acquisition and ADS TEC ENERGY PLC, you can compare the effects of market volatilities on Chardan NexTech and ADS TEC 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 Chardan NexTech with a short position of ADS TEC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chardan NexTech and ADS TEC.
Diversification Opportunities for Chardan NexTech and ADS TEC
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chardan and ADS is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Chardan NexTech Acquisition and ADS TEC ENERGY PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADS TEC ENERGY and Chardan NexTech 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 Chardan NexTech Acquisition are associated (or correlated) with ADS TEC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADS TEC ENERGY has no effect on the direction of Chardan NexTech i.e., Chardan NexTech and ADS TEC go up and down completely randomly.
Pair Corralation between Chardan NexTech and ADS TEC
Given the investment horizon of 90 days Chardan NexTech Acquisition is expected to under-perform the ADS TEC. But the stock apears to be less risky and, when comparing its historical volatility, Chardan NexTech Acquisition is 13.05 times less risky than ADS TEC. The stock trades about -0.06 of its potential returns per unit of risk. The ADS TEC ENERGY PLC is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 33.00 in ADS TEC ENERGY PLC on August 31, 2024 and sell it today you would earn a total of 289.00 from holding ADS TEC ENERGY PLC or generate 875.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.62% |
| Values | Daily Returns |
Chardan NexTech Acquisition vs. ADS TEC ENERGY PLC
Performance |
| Timeline |
| Chardan NexTech Acqu |
| ADS TEC ENERGY |
Chardan NexTech and ADS TEC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chardan NexTech and ADS TEC
The main advantage of trading using opposite Chardan NexTech and ADS TEC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chardan NexTech position performs unexpectedly, ADS TEC 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 ADS TEC will offset losses from the drop in ADS TEC's long position.| Chardan NexTech vs. Plug Power | Chardan NexTech vs. FREYR Battery SA | Chardan NexTech vs. FuelCell Energy | Chardan NexTech vs. Enovix Corp |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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