Correlation Between ADEIA P and Bitech Technologies

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

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

Diversification Opportunities for ADEIA P and Bitech Technologies

-0.57

Correlation Coefficient

ADEIA P  Bitech Technologies

Excellent diversification

The 3 months correlation between ADEIA and Bitech is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding ADEIA P and Bitech Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitech Technologies and ADEIA P 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 ADEIA P are associated (or correlated) with Bitech Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitech Technologies has no effect on the direction of ADEIA P i.e., ADEIA P and Bitech Technologies go up and down completely randomly.

Pair Corralation between ADEIA P and Bitech Technologies

Given the investment horizon of 90 days ADEIA P is expected to generate 117.21 times less return on investment than Bitech Technologies. But when comparing it to its historical volatility, ADEIA P is 4.39 times less risky than Bitech Technologies. It trades about 0.0 of its potential returns per unit of risk. Bitech Technologies is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  980.00  in Bitech Technologies on December 28, 2024 and sell it today you would earn a total of  147.00  from holding Bitech Technologies or generate 15.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

ADEIA P  vs.  Bitech Technologies

ADEIA P

Risk-Adjusted Performance

Weak

Over the last 90 days ADEIA P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, ADEIA P is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Bitech Technologies

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bitech Technologies are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Bitech Technologies exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ADEIA P and Bitech Technologies

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

The idea behind ADEIA P and Bitech Technologies 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.