Correlation Between Micro Imaging and Aeon Ventures

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

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

Diversification Opportunities for Micro Imaging and Aeon Ventures

0.0

Correlation Coefficient

Micro Imaging  Aeon Ventures

Pay attention - limited upside

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

Pair Corralation between Micro Imaging and Aeon Ventures

If you would invest  1.72  in Aeon Ventures on October 24, 2024 and sell it today you would earn a total of  0.68  from holding Aeon Ventures or generate 39.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Micro Imaging Technology  vs.  Aeon Ventures

Micro Imaging Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Micro Imaging Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Micro Imaging is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Aeon Ventures

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Aeon Ventures are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady technical and fundamental indicators, Aeon Ventures sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Micro Imaging and Aeon Ventures

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

The idea behind Micro Imaging Technology and Aeon Ventures 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.