Correlation Between Pony AI and Coda Octopus
Can any of the company-specific risk be diversified away by investing in both Pony AI and Coda Octopus 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 Pony AI and Coda Octopus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pony AI American and Coda Octopus Group, you can compare the effects of market volatilities on Pony AI and Coda Octopus 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 Pony AI with a short position of Coda Octopus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pony AI and Coda Octopus.
Diversification Opportunities for Pony AI and Coda Octopus
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Pony and Coda is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Pony AI American and Coda Octopus Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coda Octopus Group and Pony AI 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 Pony AI American are associated (or correlated) with Coda Octopus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coda Octopus Group has no effect on the direction of Pony AI i.e., Pony AI and Coda Octopus go up and down completely randomly.
Pair Corralation between Pony AI and Coda Octopus
Given the investment horizon of 90 days Pony AI American is expected to generate 1.94 times more return on investment than Coda Octopus. However, Pony AI is 1.94 times more volatile than Coda Octopus Group. It trades about 0.09 of its potential returns per unit of risk. Coda Octopus Group is currently generating about -0.17 per unit of risk. If you would invest 1,200 in Pony AI American on September 20, 2024 and sell it today you would earn a total of 73.00 from holding Pony AI American or generate 6.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 71.43% |
| Values | Daily Returns |
Pony AI American vs. Coda Octopus Group
Performance |
| Timeline |
| Pony AI American |
| Coda Octopus Group |
Pony AI and Coda Octopus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pony AI and Coda Octopus
The main advantage of trading using opposite Pony AI and Coda Octopus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pony AI position performs unexpectedly, Coda Octopus 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 Coda Octopus will offset losses from the drop in Coda Octopus' long position.| Pony AI vs. Coda Octopus Group | Pony AI vs. BCE Inc | Pony AI vs. Everspin Technologies | Pony AI vs. NetEase |
| Coda Octopus vs. Ducommun Incorporated | Coda Octopus vs. Park Electrochemical | Coda Octopus vs. National Presto Industries | Coda Octopus vs. Astronics |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |