Correlation Between Graphjet Technology and Tecogen

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

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

Diversification Opportunities for Graphjet Technology and Tecogen

0.0

Correlation Coefficient

Graphjet Technology  Tecogen

Pay attention - limited upside

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

Pair Corralation between Graphjet Technology and Tecogen

If you would invest  23.00  in Graphjet Technology on December 23, 2024 and sell it today you would lose (14.30) from holding Graphjet Technology or give up 62.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Graphjet Technology  vs.  Tecogen

Graphjet Technology

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Graphjet Technology are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Graphjet Technology demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Tecogen

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tecogen has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Tecogen is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Graphjet Technology and Tecogen

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

The idea behind Graphjet Technology and Tecogen 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.