Correlation Between Graphene Manufacturing and Nanophase Technol
Can any of the company-specific risk be diversified away by investing in both Graphene Manufacturing and Nanophase Technol 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 Graphene Manufacturing and Nanophase Technol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graphene Manufacturing Group and Nanophase Technol, you can compare the effects of market volatilities on Graphene Manufacturing and Nanophase Technol 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 Graphene Manufacturing with a short position of Nanophase Technol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graphene Manufacturing and Nanophase Technol.
Diversification Opportunities for Graphene Manufacturing and Nanophase Technol
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Graphene and Nanophase is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Graphene Manufacturing Group and Nanophase Technol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanophase Technol and Graphene Manufacturing 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 Graphene Manufacturing Group are associated (or correlated) with Nanophase Technol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanophase Technol has no effect on the direction of Graphene Manufacturing i.e., Graphene Manufacturing and Nanophase Technol go up and down completely randomly.
Pair Corralation between Graphene Manufacturing and Nanophase Technol
Assuming the 90 days horizon Graphene Manufacturing Group is expected to under-perform the Nanophase Technol. But the otc stock apears to be less risky and, when comparing its historical volatility, Graphene Manufacturing Group is 1.69 times less risky than Nanophase Technol. The otc stock trades about -0.04 of its potential returns per unit of risk. The Nanophase Technol is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 136.00 in Nanophase Technol on August 26, 2024 and sell it today you would earn a total of 4.00 from holding Nanophase Technol or generate 2.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 31.99% |
| Values | Daily Returns |
Graphene Manufacturing Group vs. Nanophase Technol
Performance |
| Timeline |
| Graphene Manufacturing |
| Nanophase Technol |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Graphene Manufacturing and Nanophase Technol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graphene Manufacturing and Nanophase Technol
The main advantage of trading using opposite Graphene Manufacturing and Nanophase Technol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graphene Manufacturing position performs unexpectedly, Nanophase Technol 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 Nanophase Technol will offset losses from the drop in Nanophase Technol's long position.| Graphene Manufacturing vs. First Graphene | Graphene Manufacturing vs. HUMANA INC | Graphene Manufacturing vs. Aquagold International | Graphene Manufacturing vs. Barloworld Ltd ADR |
| Nanophase Technol vs. Iofina plc | Nanophase Technol vs. Green Star Products | Nanophase Technol vs. Greystone Logistics | Nanophase Technol vs. Crown Electrokinetics 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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