Correlation Between ASPEN TECHINC and SANOK RUBBER
Can any of the company-specific risk be diversified away by investing in both ASPEN TECHINC and SANOK RUBBER 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 ASPEN TECHINC and SANOK RUBBER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASPEN TECHINC DL and SANOK RUBBER ZY, you can compare the effects of market volatilities on ASPEN TECHINC and SANOK RUBBER 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 ASPEN TECHINC with a short position of SANOK RUBBER. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASPEN TECHINC and SANOK RUBBER.
Diversification Opportunities for ASPEN TECHINC and SANOK RUBBER
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ASPEN and SANOK is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding ASPEN TECHINC DL and SANOK RUBBER ZY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANOK RUBBER ZY and ASPEN TECHINC 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 ASPEN TECHINC DL are associated (or correlated) with SANOK RUBBER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANOK RUBBER ZY has no effect on the direction of ASPEN TECHINC i.e., ASPEN TECHINC and SANOK RUBBER go up and down completely randomly.
Pair Corralation between ASPEN TECHINC and SANOK RUBBER
Assuming the 90 days horizon ASPEN TECHINC is expected to generate 14.78 times less return on investment than SANOK RUBBER. But when comparing it to its historical volatility, ASPEN TECHINC DL is 3.1 times less risky than SANOK RUBBER. It trades about 0.08 of its potential returns per unit of risk. SANOK RUBBER ZY is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 451.00 in SANOK RUBBER ZY on October 11, 2024 and sell it today you would earn a total of 60.00 from holding SANOK RUBBER ZY or generate 13.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASPEN TECHINC DL vs. SANOK RUBBER ZY
Performance |
| Timeline |
| ASPEN TECHINC DL |
| SANOK RUBBER ZY |
ASPEN TECHINC and SANOK RUBBER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASPEN TECHINC and SANOK RUBBER
The main advantage of trading using opposite ASPEN TECHINC and SANOK RUBBER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASPEN TECHINC position performs unexpectedly, SANOK RUBBER 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 SANOK RUBBER will offset losses from the drop in SANOK RUBBER's long position.| ASPEN TECHINC vs. Automatic Data Processing | ASPEN TECHINC vs. CODERE ONLINE LUX | ASPEN TECHINC vs. ZhongAn Online P | ASPEN TECHINC vs. SILVER BULLET DATA |
| SANOK RUBBER vs. Jacquet Metal Service | SANOK RUBBER vs. Lendlease Group | SANOK RUBBER vs. Perseus Mining Limited | SANOK RUBBER vs. Gladstone Investment |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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