Correlation Between ADTRAN and Innovid Corp
Can any of the company-specific risk be diversified away by investing in both ADTRAN and Innovid Corp 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 ADTRAN and Innovid Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ADTRAN Inc and Innovid Corp, you can compare the effects of market volatilities on ADTRAN and Innovid Corp 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 ADTRAN with a short position of Innovid Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADTRAN and Innovid Corp.
Diversification Opportunities for ADTRAN and Innovid Corp
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ADTRAN and Innovid is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding ADTRAN Inc and Innovid Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovid Corp and ADTRAN 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 ADTRAN Inc are associated (or correlated) with Innovid Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovid Corp has no effect on the direction of ADTRAN i.e., ADTRAN and Innovid Corp go up and down completely randomly.
Pair Corralation between ADTRAN and Innovid Corp
Given the investment horizon of 90 days ADTRAN is expected to generate 2.05 times less return on investment than Innovid Corp. But when comparing it to its historical volatility, ADTRAN Inc is 3.88 times less risky than Innovid Corp. It trades about 0.32 of its potential returns per unit of risk. Innovid Corp is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 196.00 in Innovid Corp on August 28, 2024 and sell it today you would earn a total of 109.00 from holding Innovid Corp or generate 55.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ADTRAN Inc vs. Innovid Corp
Performance |
| Timeline |
| ADTRAN Inc |
| Innovid Corp |
ADTRAN and Innovid Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ADTRAN and Innovid Corp
The main advantage of trading using opposite ADTRAN and Innovid Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADTRAN position performs unexpectedly, Innovid Corp 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 Innovid Corp will offset losses from the drop in Innovid Corp's long position.| ADTRAN vs. Mynaric AG ADR | ADTRAN vs. KVH Industries | ADTRAN vs. Telesat Corp | ADTRAN vs. Digi International |
| Innovid Corp vs. ADTRAN Inc | Innovid Corp vs. Belden Inc | Innovid Corp vs. ADC Therapeutics SA | Innovid Corp vs. Comtech Telecommunications Corp |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |