Correlation Between Harvest Technology and Advanced Braking
Can any of the company-specific risk be diversified away by investing in both Harvest Technology and Advanced Braking 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 Harvest Technology and Advanced Braking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Harvest Technology Group and Advanced Braking Technology, you can compare the effects of market volatilities on Harvest Technology and Advanced Braking 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 Harvest Technology with a short position of Advanced Braking. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harvest Technology and Advanced Braking.
Diversification Opportunities for Harvest Technology and Advanced Braking
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Harvest and Advanced is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Harvest Technology Group and Advanced Braking Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Braking Tec and Harvest 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 Harvest Technology Group are associated (or correlated) with Advanced Braking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Braking Tec has no effect on the direction of Harvest Technology i.e., Harvest Technology and Advanced Braking go up and down completely randomly.
Pair Corralation between Harvest Technology and Advanced Braking
Assuming the 90 days trading horizon Harvest Technology is expected to generate 1.31 times less return on investment than Advanced Braking. In addition to that, Harvest Technology is 2.74 times more volatile than Advanced Braking Technology. It trades about 0.02 of its total potential returns per unit of risk. Advanced Braking Technology is currently generating about 0.07 per unit of volatility. If you would invest 3.80 in Advanced Braking Technology on September 3, 2024 and sell it today you would earn a total of 4.30 from holding Advanced Braking Technology or generate 113.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harvest Technology Group vs. Advanced Braking Technology
Performance |
| Timeline |
| Harvest Technology |
| Advanced Braking Tec |
Harvest Technology and Advanced Braking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harvest Technology and Advanced Braking
The main advantage of trading using opposite Harvest Technology and Advanced Braking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harvest Technology position performs unexpectedly, Advanced Braking 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 Advanced Braking will offset losses from the drop in Advanced Braking's long position.| Harvest Technology vs. Commonwealth Bank | Harvest Technology vs. Commonwealth Bank of | Harvest Technology vs. Champion Iron | Harvest Technology vs. iShares Global Healthcare |
| Advanced Braking vs. Westpac Banking | Advanced Braking vs. Champion Iron | Advanced Braking vs. iShares Global Healthcare | Advanced Braking vs. Peel Mining |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |