Correlation Between Ilika Plc and Advanced Energy
Can any of the company-specific risk be diversified away by investing in both Ilika Plc and Advanced Energy 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 Ilika Plc and Advanced Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ilika plc and Advanced Energy Industries, you can compare the effects of market volatilities on Ilika Plc and Advanced Energy 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 Ilika Plc with a short position of Advanced Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ilika Plc and Advanced Energy.
Diversification Opportunities for Ilika Plc and Advanced Energy
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ilika and Advanced is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Ilika plc and Advanced Energy Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Energy Indu and Ilika Plc 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 Ilika plc are associated (or correlated) with Advanced Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Energy Indu has no effect on the direction of Ilika Plc i.e., Ilika Plc and Advanced Energy go up and down completely randomly.
Pair Corralation between Ilika Plc and Advanced Energy
Assuming the 90 days horizon Ilika plc is expected to under-perform the Advanced Energy. In addition to that, Ilika Plc is 2.17 times more volatile than Advanced Energy Industries. It trades about -0.03 of its total potential returns per unit of risk. Advanced Energy Industries is currently generating about 0.05 per unit of volatility. If you would invest 9,573 in Advanced Energy Industries on August 29, 2024 and sell it today you would earn a total of 2,148 from holding Advanced Energy Industries or generate 22.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ilika plc vs. Advanced Energy Industries
Performance |
| Timeline |
| Ilika plc |
| Advanced Energy Indu |
Ilika Plc and Advanced Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ilika Plc and Advanced Energy
The main advantage of trading using opposite Ilika Plc and Advanced Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ilika Plc position performs unexpectedly, Advanced Energy 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 Energy will offset losses from the drop in Advanced Energy's long position.| Ilika Plc vs. Novonix Ltd ADR | Ilika Plc vs. Magnis Energy Technologies | Ilika Plc vs. Exro Technologies | Ilika Plc vs. FuelPositive Corp |
| Advanced Energy vs. MKS Instruments | Advanced Energy vs. Axcelis Technologies | Advanced Energy vs. Entegris | Advanced Energy vs. Cohu Inc |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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