Correlation Between Teradyne and Nano Labs
Can any of the company-specific risk be diversified away by investing in both Teradyne and Nano Labs 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 Teradyne and Nano Labs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teradyne and Nano Labs, you can compare the effects of market volatilities on Teradyne and Nano Labs 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 Teradyne with a short position of Nano Labs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teradyne and Nano Labs.
Diversification Opportunities for Teradyne and Nano Labs
Weak diversification
The 3 months correlation between Teradyne and Nano is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Teradyne and Nano Labs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nano Labs and Teradyne 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 Teradyne are associated (or correlated) with Nano Labs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nano Labs has no effect on the direction of Teradyne i.e., Teradyne and Nano Labs go up and down completely randomly.
Pair Corralation between Teradyne and Nano Labs
Considering the 90-day investment horizon Teradyne is expected to generate 1.04 times less return on investment than Nano Labs. But when comparing it to its historical volatility, Teradyne is 4.75 times less risky than Nano Labs. It trades about 0.37 of its potential returns per unit of risk. Nano Labs is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 839.00 in Nano Labs on September 25, 2024 and sell it today you would earn a total of 60.00 from holding Nano Labs or generate 7.15% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Teradyne vs. Nano Labs
Performance |
Timeline |
Teradyne |
Nano Labs |
Teradyne and Nano Labs Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Teradyne and Nano Labs
The main advantage of trading using opposite Teradyne and Nano Labs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teradyne position performs unexpectedly, Nano Labs 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 Nano Labs will offset losses from the drop in Nano Labs' long position.Teradyne vs. IPG Photonics | Teradyne vs. Ultra Clean Holdings | Teradyne vs. Onto Innovation | Teradyne vs. Cohu Inc |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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