Correlation Between Moving IMage and AmpliTech

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

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

Diversification Opportunities for Moving IMage and AmpliTech

-0.38

Correlation Coefficient

Moving IMage  AmpliTech

Very good diversification

The 3 months correlation between Moving and AmpliTech is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Moving iMage Technologies and AmpliTech Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AmpliTech Group and Moving IMage 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 Moving iMage Technologies are associated (or correlated) with AmpliTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AmpliTech Group has no effect on the direction of Moving IMage i.e., Moving IMage and AmpliTech go up and down completely randomly.

Pair Corralation between Moving IMage and AmpliTech

Given the investment horizon of 90 days Moving IMage is expected to generate 2.69 times less return on investment than AmpliTech. In addition to that, Moving IMage is 1.11 times more volatile than AmpliTech Group. It trades about 0.07 of its total potential returns per unit of risk. AmpliTech Group is currently generating about 0.21 per unit of volatility. If you would invest  14.00  in AmpliTech Group on January 28, 2024 and sell it today you would earn a total of  4.00  from holding AmpliTech Group or generate 28.57% return on investment over 90 days.

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

Moving iMage Technologies  vs.  AmpliTech Group

Moving iMage Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Moving iMage Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in May 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

AmpliTech Group

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AmpliTech Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, AmpliTech showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Moving IMage and AmpliTech

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

The idea behind Moving iMage Technologies and AmpliTech Group 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.