Correlation Between Advanced Info and Information

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

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

Diversification Opportunities for Advanced Info and Information

0.74

Correlation Coefficient

Advanced Info  Information

Poor diversification

The 3 months correlation between Advanced and Information is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Info Service and Information and Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Information and Comm and Advanced Info 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 Advanced Info Service are associated (or correlated) with Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Information and Comm has no effect on the direction of Advanced Info i.e., Advanced Info and Information go up and down completely randomly.

Pair Corralation between Advanced Info and Information

Assuming the 90 days trading horizon Advanced Info is expected to generate 1.34 times less return on investment than Information. In addition to that, Advanced Info is 1.23 times more volatile than Information and Communication. It trades about 0.06 of its total potential returns per unit of risk. Information and Communication is currently generating about 0.09 per unit of volatility. If you would invest  176.00  in Information and Communication on April 24, 2025 and sell it today you would earn a total of  11.00  from holding Information and Communication or generate 6.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Advanced Info Service  vs.  Information and Communication

Advanced Info Service

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Advanced Info Service are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Advanced Info is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Information and Comm

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Information and Communication are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Information may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Advanced Info and Information

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

The idea behind Advanced Info Service and Information and Communication 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.