Correlation Between Exco Technologies and Advent Wireless
Can any of the company-specific risk be diversified away by investing in both Exco Technologies and Advent Wireless 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 Exco Technologies and Advent Wireless into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exco Technologies Limited and Advent Wireless, you can compare the effects of market volatilities on Exco Technologies and Advent Wireless 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 Exco Technologies with a short position of Advent Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exco Technologies and Advent Wireless.
Diversification Opportunities for Exco Technologies and Advent Wireless
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Exco and Advent is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Exco Technologies Limited and Advent Wireless in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advent Wireless and Exco Technologies 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 Exco Technologies Limited are associated (or correlated) with Advent Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advent Wireless has no effect on the direction of Exco Technologies i.e., Exco Technologies and Advent Wireless go up and down completely randomly.
Pair Corralation between Exco Technologies and Advent Wireless
If you would invest 65.00 in Advent Wireless on November 28, 2024 and sell it today you would earn a total of 0.00 from holding Advent Wireless or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Exco Technologies Limited vs. Advent Wireless
Performance |
| Timeline |
| Exco Technologies |
| Advent Wireless |
Exco Technologies and Advent Wireless Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exco Technologies and Advent Wireless
The main advantage of trading using opposite Exco Technologies and Advent Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exco Technologies position performs unexpectedly, Advent Wireless 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 Advent Wireless will offset losses from the drop in Advent Wireless' long position.| Exco Technologies vs. Transcontinental | Exco Technologies vs. Methanex | Exco Technologies vs. Stella Jones | Exco Technologies vs. High Liner Foods |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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