Correlation Between Monolithic Power and Asure Software

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Can any of the company-specific risk be diversified away by investing in both Monolithic Power and Asure Software 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 Monolithic Power and Asure Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monolithic Power Systems and Asure Software, you can compare the effects of market volatilities on Monolithic Power and Asure Software 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 Monolithic Power with a short position of Asure Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monolithic Power and Asure Software.

Diversification Opportunities for Monolithic Power and Asure Software

  Correlation Coefficient

Good diversification

The 3 months correlation between Monolithic and Asure is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Monolithic Power Systems and Asure Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asure Software and Monolithic Power 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 Monolithic Power Systems are associated (or correlated) with Asure Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asure Software has no effect on the direction of Monolithic Power i.e., Monolithic Power and Asure Software go up and down completely randomly.

Pair Corralation between Monolithic Power and Asure Software

Given the investment horizon of 90 days Monolithic Power Systems is expected to under-perform the Asure Software. In addition to that, Monolithic Power is 1.45 times more volatile than Asure Software. It trades about 0.0 of its total potential returns per unit of risk. Asure Software is currently generating about 0.02 per unit of volatility. If you would invest  842.00  in Asure Software on September 5, 2022 and sell it today you would earn a total of  56.00  from holding Asure Software or generate 6.65% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
ValuesDaily Returns

Monolithic Power Systems  vs.  Asure Software

 Performance (%) 
Monolithic Power Systems 
Monolithic Performance
0 of 100
Over the last 90 days Monolithic Power Systems has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Monolithic Power is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Monolithic Price Channel

Asure Software 
Asure Performance
21 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Asure Software are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain basic indicators, Asure Software reported solid returns over the last few months and may actually be approaching a breakup point.

Asure Price Channel

Monolithic Power and Asure Software Volatility Contrast

   Predicted Return Density   

Pair Trading with Monolithic Power and Asure Software

The main advantage of trading using opposite Monolithic Power and Asure Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monolithic Power position performs unexpectedly, Asure Software 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 Asure Software will offset losses from the drop in Asure Software's long position.
Monolithic Power vs. Amtech Systems
The idea behind Monolithic Power Systems and Asure Software 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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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 Probability Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.

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