Correlation Between Gemtek Technology and Airtac International

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

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

Diversification Opportunities for Gemtek Technology and Airtac International

-0.16

Correlation Coefficient

Gemtek Technology  Airtac International

Good diversification

The 3 months correlation between Gemtek and Airtac is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Gemtek Technology Co and Airtac International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airtac International and Gemtek 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 Gemtek Technology Co are associated (or correlated) with Airtac International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airtac International has no effect on the direction of Gemtek Technology i.e., Gemtek Technology and Airtac International go up and down completely randomly.

Pair Corralation between Gemtek Technology and Airtac International

Assuming the 90 days trading horizon Gemtek Technology Co is expected to under-perform the Airtac International. But the stock apears to be less risky and, when comparing its historical volatility, Gemtek Technology Co is 1.55 times less risky than Airtac International. The stock trades about -0.05 of its potential returns per unit of risk. The Airtac International Group is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  83,600  in Airtac International Group on December 24, 2024 and sell it today you would earn a total of  11,500  from holding Airtac International Group or generate 13.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Gemtek Technology Co  vs.  Airtac International Group

Gemtek Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gemtek Technology Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Gemtek Technology is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Airtac International

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Airtac International Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Airtac International showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gemtek Technology and Airtac International

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

The idea behind Gemtek Technology Co and Airtac International Group 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 Global Correlations module to find global opportunities by holding instruments from different markets.