Correlation Between 00108WAF7 and ANALOG
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By analyzing existing cross correlation between AEP TEX INC and ANALOG DEVICES INC, you can compare the effects of market volatilities on 00108WAF7 and ANALOG 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 00108WAF7 with a short position of ANALOG. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00108WAF7 and ANALOG.
Diversification Opportunities for 00108WAF7 and ANALOG
Good diversification
The 3 months correlation between 00108WAF7 and ANALOG is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding AEP TEX INC and ANALOG DEVICES INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANALOG DEVICES INC and 00108WAF7 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 AEP TEX INC are associated (or correlated) with ANALOG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANALOG DEVICES INC has no effect on the direction of 00108WAF7 i.e., 00108WAF7 and ANALOG go up and down completely randomly.
Pair Corralation between 00108WAF7 and ANALOG
Assuming the 90 days trading horizon AEP TEX INC is expected to generate 1.71 times more return on investment than ANALOG. However, 00108WAF7 is 1.71 times more volatile than ANALOG DEVICES INC. It trades about 0.29 of its potential returns per unit of risk. ANALOG DEVICES INC is currently generating about 0.05 per unit of risk. If you would invest 7,382 in AEP TEX INC on August 30, 2024 and sell it today you would earn a total of 839.00 from holding AEP TEX INC or generate 11.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 88.24% |
| Values | Daily Returns |
AEP TEX INC vs. ANALOG DEVICES INC
Performance |
| Timeline |
| AEP TEX INC |
| ANALOG DEVICES INC |
00108WAF7 and ANALOG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 00108WAF7 and ANALOG
The main advantage of trading using opposite 00108WAF7 and ANALOG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00108WAF7 position performs unexpectedly, ANALOG 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 ANALOG will offset losses from the drop in ANALOG's long position.| 00108WAF7 vs. Esperion Therapeutics | 00108WAF7 vs. Emerson Electric | 00108WAF7 vs. Merit Medical Systems | 00108WAF7 vs. Primoris Services |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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