Correlation Between Elcom Technology and Alphanam
Can any of the company-specific risk be diversified away by investing in both Elcom Technology and Alphanam 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 Elcom Technology and Alphanam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elcom Technology Communications and Alphanam ME, you can compare the effects of market volatilities on Elcom Technology and Alphanam 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 Elcom Technology with a short position of Alphanam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elcom Technology and Alphanam.
Diversification Opportunities for Elcom Technology and Alphanam
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Elcom and Alphanam is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Elcom Technology Communication and Alphanam ME in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alphanam ME and Elcom 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 Elcom Technology Communications are associated (or correlated) with Alphanam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alphanam ME has no effect on the direction of Elcom Technology i.e., Elcom Technology and Alphanam go up and down completely randomly.
Pair Corralation between Elcom Technology and Alphanam
Assuming the 90 days trading horizon Elcom Technology Communications is expected to generate 0.9 times more return on investment than Alphanam. However, Elcom Technology Communications is 1.11 times less risky than Alphanam. It trades about 0.08 of its potential returns per unit of risk. Alphanam ME is currently generating about -0.08 per unit of risk. If you would invest 1,170,000 in Elcom Technology Communications on October 16, 2024 and sell it today you would earn a total of 1,440,000 from holding Elcom Technology Communications or generate 123.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 66.06% |
| Values | Daily Returns |
Elcom Technology Communication vs. Alphanam ME
Performance |
| Timeline |
| Elcom Technology Com |
| Alphanam ME |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Elcom Technology and Alphanam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elcom Technology and Alphanam
The main advantage of trading using opposite Elcom Technology and Alphanam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elcom Technology position performs unexpectedly, Alphanam 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 Alphanam will offset losses from the drop in Alphanam's long position.| Elcom Technology vs. Hanoi Plastics JSC | Elcom Technology vs. Viet Thanh Plastic | Elcom Technology vs. Vietnam Petroleum Transport | Elcom Technology vs. PetroVietnam Drilling Well |
| Alphanam vs. Elcom Technology Communications | Alphanam vs. Techno Agricultural Supplying | Alphanam vs. Kien Giang Construction | Alphanam vs. Investment And Construction |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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