Correlation Between Acesite Hotel and Integrated Micro

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

By analyzing existing cross correlation between Acesite Hotel Corp and Integrated Micro Electronics, you can compare the effects of market volatilities on Acesite Hotel and Integrated Micro 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 Acesite Hotel with a short position of Integrated Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acesite Hotel and Integrated Micro.

Diversification Opportunities for Acesite Hotel and Integrated Micro

-0.12

Correlation Coefficient

Acesite Hotel  Integrated Micro

Good diversification

The 3 months correlation between Acesite and Integrated is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Acesite Hotel Corp and Integrated Micro Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integrated Micro Ele and Acesite Hotel 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 Acesite Hotel Corp are associated (or correlated) with Integrated Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integrated Micro Ele has no effect on the direction of Acesite Hotel i.e., Acesite Hotel and Integrated Micro go up and down completely randomly.

Pair Corralation between Acesite Hotel and Integrated Micro

Assuming the 90 days trading horizon Acesite Hotel Corp is expected to generate 1.8 times more return on investment than Integrated Micro. However, Acesite Hotel is 1.8 times more volatile than Integrated Micro Electronics. It trades about 0.03 of its potential returns per unit of risk. Integrated Micro Electronics is currently generating about -0.09 per unit of risk. If you would invest  175.00  in Acesite Hotel Corp on October 5, 2024 and sell it today you would earn a total of  3.00  from holding Acesite Hotel Corp or generate 1.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	37.07%
Values	Daily Returns

Acesite Hotel Corp  vs.  Integrated Micro Electronics

Acesite Hotel Corp

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Acesite Hotel Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather unsteady technical and fundamental indicators, Acesite Hotel may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Integrated Micro Ele

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Integrated Micro Electronics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Acesite Hotel and Integrated Micro

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

The idea behind Acesite Hotel Corp and Integrated Micro Electronics 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.