Correlation Between Impax Asset and Xeros Technology
Can any of the company-specific risk be diversified away by investing in both Impax Asset and Xeros Technology 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 Impax Asset and Xeros Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impax Asset Management and Xeros Technology Group, you can compare the effects of market volatilities on Impax Asset and Xeros Technology 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 Impax Asset with a short position of Xeros Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impax Asset and Xeros Technology.
Diversification Opportunities for Impax Asset and Xeros Technology
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Impax and Xeros is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Impax Asset Management and Xeros Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xeros Technology and Impax Asset 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 Impax Asset Management are associated (or correlated) with Xeros Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xeros Technology has no effect on the direction of Impax Asset i.e., Impax Asset and Xeros Technology go up and down completely randomly.
Pair Corralation between Impax Asset and Xeros Technology
Assuming the 90 days trading horizon Impax Asset Management is expected to generate 0.59 times more return on investment than Xeros Technology. However, Impax Asset Management is 1.69 times less risky than Xeros Technology. It trades about -0.13 of its potential returns per unit of risk. Xeros Technology Group is currently generating about -0.11 per unit of risk. If you would invest 36,200 in Impax Asset Management on November 2, 2024 and sell it today you would lose (14,550) from holding Impax Asset Management or give up 40.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Impax Asset Management vs. Xeros Technology Group
Performance |
| Timeline |
| Impax Asset Management |
| Xeros Technology |
Impax Asset and Xeros Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impax Asset and Xeros Technology
The main advantage of trading using opposite Impax Asset and Xeros Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impax Asset position performs unexpectedly, Xeros Technology 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 Xeros Technology will offset losses from the drop in Xeros Technology's long position.| Impax Asset vs. National Beverage Corp | Impax Asset vs. Grieg Seafood | Impax Asset vs. Fevertree Drinks Plc | Impax Asset vs. Sealed Air Corp |
| Xeros Technology vs. Bisichi Mining PLC | Xeros Technology vs. Fresenius Medical Care | Xeros Technology vs. PureTech Health plc | Xeros Technology vs. Bellevue Healthcare Trust |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Stocks Directory Find actively traded stocks across global markets | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |