Correlation Between Baylin Technologies and AdvanceTC

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

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

Diversification Opportunities for Baylin Technologies and AdvanceTC

-0.35

Correlation Coefficient

Baylin Technologies  AdvanceTC

Very good diversification

The 3 months correlation between Baylin and AdvanceTC is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Baylin Technologies and AdvanceTC Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AdvanceTC Limited and Baylin Technologies 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 Baylin Technologies are associated (or correlated) with AdvanceTC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AdvanceTC Limited has no effect on the direction of Baylin Technologies i.e., Baylin Technologies and AdvanceTC go up and down completely randomly.

Pair Corralation between Baylin Technologies and AdvanceTC

Assuming the 90 days horizon Baylin Technologies is expected to under-perform the AdvanceTC. But the otc stock apears to be less risky and, when comparing its historical volatility, Baylin Technologies is 33.1 times less risky than AdvanceTC. The otc stock trades about -0.21 of its potential returns per unit of risk. The AdvanceTC Limited is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  0.11  in AdvanceTC Limited on December 30, 2024 and sell it today you would earn a total of  0.00  from holding AdvanceTC Limited or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Baylin Technologies  vs.  AdvanceTC Limited

Baylin Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Baylin Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

AdvanceTC Limited

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AdvanceTC Limited are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating essential indicators, AdvanceTC reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Baylin Technologies and AdvanceTC

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

The idea behind Baylin Technologies and AdvanceTC Limited 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .