Correlation Between Airtac International and Macroblock

Can any of the company-specific risk be diversified away by investing in both Airtac International and Macroblock 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 Airtac International and Macroblock into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Airtac International Group and Macroblock, you can compare the effects of market volatilities on Airtac International and Macroblock 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 Airtac International with a short position of Macroblock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airtac International and Macroblock.

Diversification Opportunities for Airtac International and Macroblock

0.8

Correlation Coefficient

Airtac International  Macroblock

Very poor diversification

The 3 months correlation between Airtac and Macroblock is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Airtac International Group and Macroblock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macroblock and Airtac International 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 Airtac International Group are associated (or correlated) with Macroblock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macroblock has no effect on the direction of Airtac International i.e., Airtac International and Macroblock go up and down completely randomly.

Pair Corralation between Airtac International and Macroblock

Assuming the 90 days trading horizon Airtac International Group is expected to generate 1.38 times more return on investment than Macroblock. However, Airtac International is 1.38 times more volatile than Macroblock. It trades about 0.11 of its potential returns per unit of risk. Macroblock is currently generating about -0.04 per unit of risk. If you would invest  79,500  in Airtac International Group on September 28, 2024 and sell it today you would earn a total of  4,500  from holding Airtac International Group or generate 5.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	95.65%
Values	Daily Returns

Airtac International Group  vs.  Macroblock

Airtac International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Airtac International Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Macroblock

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Macroblock has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Airtac International and Macroblock

The main advantage of trading using opposite Airtac International and Macroblock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airtac International position performs unexpectedly, Macroblock 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 Macroblock will offset losses from the drop in Macroblock's long position.

The idea behind Airtac International Group and Macroblock 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.

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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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.