Correlation Between Optimax Technology and Asia Optical

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Optimax Technology and Asia Optical 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 Optimax Technology and Asia Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Optimax Technology Corp and Asia Optical Co, you can compare the effects of market volatilities on Optimax Technology and Asia Optical 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 Optimax Technology with a short position of Asia Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Optimax Technology and Asia Optical.

Diversification Opportunities for Optimax Technology and Asia Optical

OptimaxAsiaDiversified AwayOptimaxAsiaDiversified Away100%
-0.01
  Correlation Coefficient

Good diversification

The 3 months correlation between Optimax and Asia is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Optimax Technology Corp and Asia Optical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Optical and Optimax 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 Optimax Technology Corp are associated (or correlated) with Asia Optical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Optical has no effect on the direction of Optimax Technology i.e., Optimax Technology and Asia Optical go up and down completely randomly.

Pair Corralation between Optimax Technology and Asia Optical

Assuming the 90 days trading horizon Optimax Technology Corp is expected to under-perform the Asia Optical. But the stock apears to be less risky and, when comparing its historical volatility, Optimax Technology Corp is 2.06 times less risky than Asia Optical. The stock trades about -0.04 of its potential returns per unit of risk. The Asia Optical Co is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest  11,200  in Asia Optical Co on November 21, 2024 and sell it today you would earn a total of  9,100  from holding Asia Optical Co or generate 81.25% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Optimax Technology Corp  vs.  Asia Optical Co

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb 020406080
JavaScript chart by amCharts 3.21.153051 3019
       Timeline  
Optimax Technology Corp 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Optimax Technology Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Optimax Technology is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb303132333435
Asia Optical 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Asia Optical Co are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Asia Optical showed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb120140160180200

Optimax Technology and Asia Optical Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.23-2.42-1.61-0.8-0.01280.761.532.33.07 0.030.040.050.060.070.080.090.10
JavaScript chart by amCharts 3.21.153051 3019
       Returns  

Pair Trading with Optimax Technology and Asia Optical

The main advantage of trading using opposite Optimax Technology and Asia Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Optimax Technology position performs unexpectedly, Asia Optical 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 Asia Optical will offset losses from the drop in Asia Optical's long position.
The idea behind Optimax Technology Corp and Asia Optical Co 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.

Other Complementary Tools

Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Fundamentals Comparison
Compare fundamentals across multiple equities to find investing opportunities
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals