Correlation Between AirIQ and Image Protect
Can any of the company-specific risk be diversified away by investing in both AirIQ and Image Protect 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 AirIQ and Image Protect into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AirIQ Inc and Image Protect, you can compare the effects of market volatilities on AirIQ and Image Protect 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 AirIQ with a short position of Image Protect. Check out your portfolio center. Please also check ongoing floating volatility patterns of AirIQ and Image Protect.
Diversification Opportunities for AirIQ and Image Protect
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AirIQ and Image is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding AirIQ Inc and Image Protect in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Image Protect and AirIQ 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 AirIQ Inc are associated (or correlated) with Image Protect. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Image Protect has no effect on the direction of AirIQ i.e., AirIQ and Image Protect go up and down completely randomly.
Pair Corralation between AirIQ and Image Protect
Assuming the 90 days horizon AirIQ is expected to generate 23.09 times less return on investment than Image Protect. But when comparing it to its historical volatility, AirIQ Inc is 9.32 times less risky than Image Protect. It trades about 0.05 of its potential returns per unit of risk. Image Protect is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 0.02 in Image Protect on August 31, 2024 and sell it today you would lose (0.01) from holding Image Protect or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AirIQ Inc vs. Image Protect
Performance |
| Timeline |
| AirIQ Inc |
| Image Protect |
AirIQ and Image Protect Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AirIQ and Image Protect
The main advantage of trading using opposite AirIQ and Image Protect positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AirIQ position performs unexpectedly, Image Protect 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 Image Protect will offset losses from the drop in Image Protect's long position.The idea behind AirIQ Inc and Image Protect 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.| Image Protect vs. Waldencast Acquisition Corp | Image Protect vs. Alkami Technology | Image Protect vs. ADEIA P | Image Protect vs. Paycor HCM |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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