Correlation Between Energy Technologies and Regal Funds
Can any of the company-specific risk be diversified away by investing in both Energy Technologies and Regal Funds 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 Energy Technologies and Regal Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy Technologies Limited and Regal Funds Management, you can compare the effects of market volatilities on Energy Technologies and Regal Funds 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 Energy Technologies with a short position of Regal Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Technologies and Regal Funds.
Diversification Opportunities for Energy Technologies and Regal Funds
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Energy and Regal is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Energy Technologies Limited and Regal Funds Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regal Funds Management and Energy Technologies 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 Energy Technologies Limited are associated (or correlated) with Regal Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regal Funds Management has no effect on the direction of Energy Technologies i.e., Energy Technologies and Regal Funds go up and down completely randomly.
Pair Corralation between Energy Technologies and Regal Funds
Assuming the 90 days trading horizon Energy Technologies Limited is expected to under-perform the Regal Funds. But the stock apears to be less risky and, when comparing its historical volatility, Energy Technologies Limited is 1.15 times less risky than Regal Funds. The stock trades about 0.0 of its potential returns per unit of risk. The Regal Funds Management is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 236.00 in Regal Funds Management on January 15, 2025 and sell it today you would lose (42.00) from holding Regal Funds Management or give up 17.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Energy Technologies Limited vs. Regal Funds Management
Performance |
| Timeline |
| Energy Technologies |
| Regal Funds Management |
Energy Technologies and Regal Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Technologies and Regal Funds
The main advantage of trading using opposite Energy Technologies and Regal Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Technologies position performs unexpectedly, Regal Funds 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 Regal Funds will offset losses from the drop in Regal Funds' long position.| Energy Technologies vs. BNK Banking | Energy Technologies vs. Sky Metals | Energy Technologies vs. 29Metals | Energy Technologies vs. Insurance Australia Group |
| Regal Funds vs. Polymetals Resources | Regal Funds vs. Apiam Animal Health | Regal Funds vs. ACDC Metals | Regal Funds vs. Aeon Metals |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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