Correlation Between Xeros Technology and Impax Asset
Can any of the company-specific risk be diversified away by investing in both Xeros Technology and Impax Asset 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 Xeros Technology and Impax Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xeros Technology Group and Impax Asset Management, you can compare the effects of market volatilities on Xeros Technology and Impax Asset 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 Xeros Technology with a short position of Impax Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xeros Technology and Impax Asset.
Diversification Opportunities for Xeros Technology and Impax Asset
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xeros and Impax is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Xeros Technology Group and Impax Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impax Asset Management and Xeros 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 Xeros Technology Group are associated (or correlated) with Impax Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impax Asset Management has no effect on the direction of Xeros Technology i.e., Xeros Technology and Impax Asset go up and down completely randomly.
Pair Corralation between Xeros Technology and Impax Asset
Assuming the 90 days trading horizon Xeros Technology Group is expected to under-perform the Impax Asset. In addition to that, Xeros Technology is 1.61 times more volatile than Impax Asset Management. It trades about -0.07 of its total potential returns per unit of risk. Impax Asset Management is currently generating about -0.07 per unit of volatility. If you would invest 68,163 in Impax Asset Management on October 16, 2024 and sell it today you would lose (47,913) from holding Impax Asset Management or give up 70.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xeros Technology Group vs. Impax Asset Management
Performance |
| Timeline |
| Xeros Technology |
| Impax Asset Management |
Xeros Technology and Impax Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xeros Technology and Impax Asset
The main advantage of trading using opposite Xeros Technology and Impax Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xeros Technology position performs unexpectedly, Impax Asset 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 Impax Asset will offset losses from the drop in Impax Asset's long position.| Xeros Technology vs. Taiwan Semiconductor Manufacturing | Xeros Technology vs. XLMedia PLC | Xeros Technology vs. Zinc Media Group | Xeros Technology vs. Liberty Media Corp |
| Impax Asset vs. PureTech Health plc | Impax Asset vs. Micron Technology | Impax Asset vs. Zoom Video Communications | Impax Asset vs. Xeros Technology 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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