Correlation Between Patriot Battery and AiMedia Technologies
Can any of the company-specific risk be diversified away by investing in both Patriot Battery and AiMedia Technologies 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 Patriot Battery and AiMedia Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Patriot Battery Metals and AiMedia Technologies, you can compare the effects of market volatilities on Patriot Battery and AiMedia Technologies 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 Patriot Battery with a short position of AiMedia Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Patriot Battery and AiMedia Technologies.
Diversification Opportunities for Patriot Battery and AiMedia Technologies
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Patriot and AiMedia is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Patriot Battery Metals and AiMedia Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AiMedia Technologies and Patriot Battery 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 Patriot Battery Metals are associated (or correlated) with AiMedia Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AiMedia Technologies has no effect on the direction of Patriot Battery i.e., Patriot Battery and AiMedia Technologies go up and down completely randomly.
Pair Corralation between Patriot Battery and AiMedia Technologies
Assuming the 90 days trading horizon Patriot Battery Metals is expected to generate 1.16 times more return on investment than AiMedia Technologies. However, Patriot Battery is 1.16 times more volatile than AiMedia Technologies. It trades about 0.03 of its potential returns per unit of risk. AiMedia Technologies is currently generating about 0.02 per unit of risk. If you would invest 32.00 in Patriot Battery Metals on September 15, 2024 and sell it today you would earn a total of 0.00 from holding Patriot Battery Metals or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Patriot Battery Metals vs. AiMedia Technologies
Performance |
| Timeline |
| Patriot Battery Metals |
| AiMedia Technologies |
Patriot Battery and AiMedia Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Patriot Battery and AiMedia Technologies
The main advantage of trading using opposite Patriot Battery and AiMedia Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Patriot Battery position performs unexpectedly, AiMedia Technologies 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 AiMedia Technologies will offset losses from the drop in AiMedia Technologies' long position.| Patriot Battery vs. Advanced Braking Technology | Patriot Battery vs. Ainsworth Game Technology | Patriot Battery vs. Treasury Wine Estates | Patriot Battery vs. Ras Technology Holdings |
| AiMedia Technologies vs. Audio Pixels Holdings | AiMedia Technologies vs. Iodm | AiMedia Technologies vs. Nsx | AiMedia Technologies vs. TTG Fintech |
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 Stocks Directory module to find actively traded stocks across global markets.
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