Correlation Between Maris Tech and Amphenol
Can any of the company-specific risk be diversified away by investing in both Maris Tech and Amphenol 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 Maris Tech and Amphenol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maris Tech and Amphenol, you can compare the effects of market volatilities on Maris Tech and Amphenol 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 Maris Tech with a short position of Amphenol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maris Tech and Amphenol.
Diversification Opportunities for Maris Tech and Amphenol
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Maris and Amphenol is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Maris Tech and Amphenol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amphenol and Maris Tech 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 Maris Tech are associated (or correlated) with Amphenol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amphenol has no effect on the direction of Maris Tech i.e., Maris Tech and Amphenol go up and down completely randomly.
Pair Corralation between Maris Tech and Amphenol
Given the investment horizon of 90 days Maris Tech is expected to generate 1.35 times more return on investment than Amphenol. However, Maris Tech is 1.35 times more volatile than Amphenol. It trades about 0.0 of its potential returns per unit of risk. Amphenol is currently generating about -0.02 per unit of risk. If you would invest 196.00 in Maris Tech on June 29, 2024 and sell it today you would lose (2.00) from holding Maris Tech or give up 1.02% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Maris Tech vs. Amphenol
Performance |
Timeline |
Maris Tech |
Amphenol |
Maris Tech and Amphenol Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Maris Tech and Amphenol
The main advantage of trading using opposite Maris Tech and Amphenol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maris Tech position performs unexpectedly, Amphenol 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 Amphenol will offset losses from the drop in Amphenol's long position.The idea behind Maris Tech and Amphenol pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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