Correlation Between Elcom Technology and APG Securities
Can any of the company-specific risk be diversified away by investing in both Elcom Technology and APG Securities 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 APG Securities 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 APG Securities Joint, you can compare the effects of market volatilities on Elcom Technology and APG Securities 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 APG Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elcom Technology and APG Securities.
Diversification Opportunities for Elcom Technology and APG Securities
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Elcom and APG is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Elcom Technology Communication and APG Securities Joint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APG Securities Joint 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 APG Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APG Securities Joint has no effect on the direction of Elcom Technology i.e., Elcom Technology and APG Securities go up and down completely randomly.
Pair Corralation between Elcom Technology and APG Securities
Assuming the 90 days trading horizon Elcom Technology Communications is expected to generate 0.28 times more return on investment than APG Securities. However, Elcom Technology Communications is 3.51 times less risky than APG Securities. It trades about -0.2 of its potential returns per unit of risk. APG Securities Joint is currently generating about -0.23 per unit of risk. If you would invest 2,745,000 in Elcom Technology Communications on October 13, 2024 and sell it today you would lose (145,000) from holding Elcom Technology Communications or give up 5.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elcom Technology Communication vs. APG Securities Joint
Performance |
| Timeline |
| Elcom Technology Com |
| APG Securities Joint |
Elcom Technology and APG Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elcom Technology and APG Securities
The main advantage of trading using opposite Elcom Technology and APG Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elcom Technology position performs unexpectedly, APG Securities 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 APG Securities will offset losses from the drop in APG Securities' long position.| Elcom Technology vs. Transport and Industry | Elcom Technology vs. Petrolimex Information Technology | Elcom Technology vs. Techno Agricultural Supplying | Elcom Technology vs. Hai An Transport |
| APG Securities vs. Nafoods Group JSC | APG Securities vs. Elcom Technology Communications | APG Securities vs. PetroVietnam Drilling Well | APG Securities vs. Industrial Urban Development |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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