Correlation Between Electronic Systems and Frequency Electronics
Can any of the company-specific risk be diversified away by investing in both Electronic Systems and Frequency Electronics 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 Electronic Systems and Frequency Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electronic Systems Technology and Frequency Electronics, you can compare the effects of market volatilities on Electronic Systems and Frequency Electronics 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 Electronic Systems with a short position of Frequency Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electronic Systems and Frequency Electronics.
Diversification Opportunities for Electronic Systems and Frequency Electronics
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Electronic and Frequency is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Electronic Systems Technology and Frequency Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frequency Electronics and Electronic Systems 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 Electronic Systems Technology are associated (or correlated) with Frequency Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frequency Electronics has no effect on the direction of Electronic Systems i.e., Electronic Systems and Frequency Electronics go up and down completely randomly.
Pair Corralation between Electronic Systems and Frequency Electronics
Given the investment horizon of 90 days Electronic Systems Technology is expected to under-perform the Frequency Electronics. In addition to that, Electronic Systems is 2.63 times more volatile than Frequency Electronics. It trades about -0.28 of its total potential returns per unit of risk. Frequency Electronics is currently generating about -0.14 per unit of volatility. If you would invest 1,889 in Frequency Electronics on October 24, 2024 and sell it today you would lose (123.50) from holding Frequency Electronics or give up 6.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Electronic Systems Technology vs. Frequency Electronics
Performance |
| Timeline |
| Electronic Systems |
| Frequency Electronics |
Electronic Systems and Frequency Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electronic Systems and Frequency Electronics
The main advantage of trading using opposite Electronic Systems and Frequency Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electronic Systems position performs unexpectedly, Frequency Electronics 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 Frequency Electronics will offset losses from the drop in Frequency Electronics' long position.| Electronic Systems vs. BeWhere Holdings | Electronic Systems vs. Frequency Electronics | Electronic Systems vs. Wialan Technologies | Electronic Systems vs. TPT Global Tech |
| Frequency Electronics vs. BK Technologies | Frequency Electronics vs. Actelis Networks | Frequency Electronics vs. Lantronix | Frequency Electronics vs. KVH Industries |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |