Correlation Between Firsthand Technology and Ancora/thelen Small-mid
Can any of the company-specific risk be diversified away by investing in both Firsthand Technology and Ancora/thelen Small-mid 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 Firsthand Technology and Ancora/thelen Small-mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Firsthand Technology Opportunities and Ancorathelen Small Mid Cap, you can compare the effects of market volatilities on Firsthand Technology and Ancora/thelen Small-mid 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 Firsthand Technology with a short position of Ancora/thelen Small-mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firsthand Technology and Ancora/thelen Small-mid.
Diversification Opportunities for Firsthand Technology and Ancora/thelen Small-mid
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Firsthand and Ancora/thelen is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Firsthand Technology Opportuni and Ancorathelen Small Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ancora/thelen Small-mid and Firsthand Technology 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 Firsthand Technology Opportunities are associated (or correlated) with Ancora/thelen Small-mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ancora/thelen Small-mid has no effect on the direction of Firsthand Technology i.e., Firsthand Technology and Ancora/thelen Small-mid go up and down completely randomly.
Pair Corralation between Firsthand Technology and Ancora/thelen Small-mid
Assuming the 90 days horizon Firsthand Technology Opportunities is expected to generate 1.31 times more return on investment than Ancora/thelen Small-mid. However, Firsthand Technology is 1.31 times more volatile than Ancorathelen Small Mid Cap. It trades about 0.36 of its potential returns per unit of risk. Ancorathelen Small Mid Cap is currently generating about 0.39 per unit of risk. If you would invest 360.00 in Firsthand Technology Opportunities on September 4, 2024 and sell it today you would earn a total of 45.00 from holding Firsthand Technology Opportunities or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Firsthand Technology Opportuni vs. Ancorathelen Small Mid Cap
Performance |
| Timeline |
| Firsthand Technology |
| Ancora/thelen Small-mid |
Firsthand Technology and Ancora/thelen Small-mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firsthand Technology and Ancora/thelen Small-mid
The main advantage of trading using opposite Firsthand Technology and Ancora/thelen Small-mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firsthand Technology position performs unexpectedly, Ancora/thelen Small-mid 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 Ancora/thelen Small-mid will offset losses from the drop in Ancora/thelen Small-mid's long position.| Firsthand Technology vs. Berkshire Focus | Firsthand Technology vs. Red Oak Technology | Firsthand Technology vs. Jacob Internet Fund | Firsthand Technology vs. Kinetics Internet Fund |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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