Correlation Between Flytech Technology and Aten International

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

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

Diversification Opportunities for Flytech Technology and Aten International

0.0

Correlation Coefficient

Flytech Technology  Aten International

Pay attention - limited upside

The 3 months correlation between Flytech and Aten is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Flytech Technology Co and Aten International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aten International and Flytech 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 Flytech Technology Co are associated (or correlated) with Aten International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aten International has no effect on the direction of Flytech Technology i.e., Flytech Technology and Aten International go up and down completely randomly.

Pair Corralation between Flytech Technology and Aten International

Assuming the 90 days trading horizon Flytech Technology Co is expected to generate 4.03 times more return on investment than Aten International. However, Flytech Technology is 4.03 times more volatile than Aten International Co. It trades about 0.15 of its potential returns per unit of risk. Aten International Co is currently generating about -0.03 per unit of risk. If you would invest  7,100  in Flytech Technology Co on December 2, 2024 and sell it today you would earn a total of  8,150  from holding Flytech Technology Co or generate 114.79% return on investment over 90 days.

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

Flytech Technology Co  vs.  Aten International Co

Flytech Technology

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Flytech Technology Co are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Flytech Technology showed solid returns over the last few months and may actually be approaching a breakup point.

Aten International

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Flytech Technology and Aten International

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

The idea behind Flytech Technology Co and Aten International 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.

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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.