Correlation Between Made Tech and Anglo Eastern
Can any of the company-specific risk be diversified away by investing in both Made Tech and Anglo Eastern 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 Made Tech and Anglo Eastern into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Made Tech Group and Anglo Eastern Plantations PLC, you can compare the effects of market volatilities on Made Tech and Anglo Eastern 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 Made Tech with a short position of Anglo Eastern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Made Tech and Anglo Eastern.
Diversification Opportunities for Made Tech and Anglo Eastern
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Made and Anglo is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Made Tech Group and Anglo Eastern Plantations PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anglo Eastern Planta and Made Tech 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 Made Tech Group are associated (or correlated) with Anglo Eastern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anglo Eastern Planta has no effect on the direction of Made Tech i.e., Made Tech and Anglo Eastern go up and down completely randomly.
Pair Corralation between Made Tech and Anglo Eastern
Assuming the 90 days trading horizon Made Tech Group is expected to generate 3.73 times more return on investment than Anglo Eastern. However, Made Tech is 3.73 times more volatile than Anglo Eastern Plantations PLC. It trades about 0.08 of its potential returns per unit of risk. Anglo Eastern Plantations PLC is currently generating about 0.02 per unit of risk. If you would invest 1,100 in Made Tech Group on September 14, 2024 and sell it today you would earn a total of 1,150 from holding Made Tech Group or generate 104.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Made Tech Group vs. Anglo Eastern Plantations PLC
Performance |
| Timeline |
| Made Tech Group |
| Anglo Eastern Planta |
Made Tech and Anglo Eastern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Made Tech and Anglo Eastern
The main advantage of trading using opposite Made Tech and Anglo Eastern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Made Tech position performs unexpectedly, Anglo Eastern 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 Anglo Eastern will offset losses from the drop in Anglo Eastern's long position.| Made Tech vs. Samsung Electronics Co | Made Tech vs. Samsung Electronics Co | Made Tech vs. Hyundai Motor | Made Tech vs. Toyota Motor Corp |
| Anglo Eastern vs. Futura Medical | Anglo Eastern vs. CVS Health Corp | Anglo Eastern vs. CompuGroup Medical AG | Anglo Eastern vs. Creo Medical Group |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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