Correlation Between Allied Motion and AT S

Can any of the company-specific risk be diversified away by investing in both Allied Motion and AT S 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 Allied Motion and AT S into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Allied Motion and AT S

-0.26

Correlation Coefficient

Allied Motion  AT S

Very good diversification

The 3 months correlation between Allied and ASAAF is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Allied Motion Technologies and AT S Austria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AT S Austria and Allied Motion 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 Allied Motion Technologies are associated (or correlated) with AT S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AT S Austria has no effect on the direction of Allied Motion i.e., Allied Motion and AT S go up and down completely randomly.

Pair Corralation between Allied Motion and AT S

Given the investment horizon of 90 days Allied Motion Technologies is expected to generate 0.85 times more return on investment than AT S. However, Allied Motion Technologies is 1.17 times less risky than AT S. It trades about 0.06 of its potential returns per unit of risk. AT S Austria is currently generating about -0.04 per unit of risk. If you would invest  3,321  in Allied Motion Technologies on September 13, 2024 and sell it today you would earn a total of  596.00  from holding Allied Motion Technologies or generate 17.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	29.35%
Values	Daily Returns

Allied Motion Technologies  vs.  AT S Austria

Allied Motion Techno

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Allied Motion Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Allied Motion is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

AT S Austria

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AT S Austria are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, AT S is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Allied Motion and AT S

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

The idea behind Allied Motion Technologies and AT S Austria 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 Commodity Directory module to find actively traded commodities issued by global exchanges.