Correlation Between Inventronics and Imaflex
Can any of the company-specific risk be diversified away by investing in both Inventronics and Imaflex 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 Inventronics and Imaflex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inventronics and Imaflex, you can compare the effects of market volatilities on Inventronics and Imaflex 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 Inventronics with a short position of Imaflex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inventronics and Imaflex.
Diversification Opportunities for Inventronics and Imaflex
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Inventronics and Imaflex is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Inventronics and Imaflex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imaflex and Inventronics 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 Inventronics are associated (or correlated) with Imaflex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imaflex has no effect on the direction of Inventronics i.e., Inventronics and Imaflex go up and down completely randomly.
Pair Corralation between Inventronics and Imaflex
Assuming the 90 days horizon Inventronics is expected to generate 0.63 times more return on investment than Imaflex. However, Inventronics is 1.58 times less risky than Imaflex. It trades about 0.21 of its potential returns per unit of risk. Imaflex is currently generating about -0.1 per unit of risk. If you would invest 71.00 in Inventronics on August 30, 2024 and sell it today you would earn a total of 6.00 from holding Inventronics or generate 8.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inventronics vs. Imaflex
Performance |
| Timeline |
| Inventronics |
| Imaflex |
Inventronics and Imaflex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inventronics and Imaflex
The main advantage of trading using opposite Inventronics and Imaflex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inventronics position performs unexpectedly, Imaflex 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 Imaflex will offset losses from the drop in Imaflex's long position.| Inventronics vs. Atlas Engineered Products | Inventronics vs. Fab Form Industries | Inventronics vs. Imaflex | Inventronics vs. Bri Chem Corp |
| Imaflex vs. AirIQ Inc | Imaflex vs. NamSys Inc | Imaflex vs. Supremex | Imaflex vs. Atlas Engineered Products |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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