Correlation Between Interlink Electronics and Maris Tech
Can any of the company-specific risk be diversified away by investing in both Interlink Electronics and Maris Tech 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 Interlink Electronics and Maris Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Interlink Electronics and Maris Tech, you can compare the effects of market volatilities on Interlink Electronics and Maris Tech 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 Interlink Electronics with a short position of Maris Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interlink Electronics and Maris Tech.
Diversification Opportunities for Interlink Electronics and Maris Tech
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Interlink and Maris is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Interlink Electronics and Maris Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maris Tech and Interlink Electronics 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 Interlink Electronics are associated (or correlated) with Maris Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maris Tech has no effect on the direction of Interlink Electronics i.e., Interlink Electronics and Maris Tech go up and down completely randomly.
Pair Corralation between Interlink Electronics and Maris Tech
Given the investment horizon of 90 days Interlink Electronics is expected to generate 6.58 times less return on investment than Maris Tech. In addition to that, Interlink Electronics is 1.17 times more volatile than Maris Tech. It trades about 0.01 of its total potential returns per unit of risk. Maris Tech is currently generating about 0.05 per unit of volatility. If you would invest 89.00 in Maris Tech on August 24, 2024 and sell it today you would earn a total of 86.00 from holding Maris Tech or generate 96.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.79% |
| Values | Daily Returns |
Interlink Electronics vs. Maris Tech
Performance |
| Timeline |
| Interlink Electronics |
| Maris Tech |
Interlink Electronics and Maris Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Interlink Electronics and Maris Tech
The main advantage of trading using opposite Interlink Electronics and Maris Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Interlink Electronics position performs unexpectedly, Maris Tech 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 Maris Tech will offset losses from the drop in Maris Tech's long position.| Interlink Electronics vs. Methode Electronics | Interlink Electronics vs. Bel Fuse A | Interlink Electronics vs. CTS Corporation | Interlink Electronics vs. MicroCloud Hologram |
| Maris Tech vs. Methode Electronics | Maris Tech vs. LightPath Technologies | Maris Tech vs. Interlink Electronics | Maris Tech vs. SigmaTron International |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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