Correlation Between Airthings ASA and Exact Therapeutics
Can any of the company-specific risk be diversified away by investing in both Airthings ASA and Exact Therapeutics 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 Airthings ASA and Exact Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airthings ASA and Exact Therapeutics AS, you can compare the effects of market volatilities on Airthings ASA and Exact Therapeutics 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 Airthings ASA with a short position of Exact Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airthings ASA and Exact Therapeutics.
Diversification Opportunities for Airthings ASA and Exact Therapeutics
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Airthings and Exact is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Airthings ASA and Exact Therapeutics AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exact Therapeutics and Airthings ASA 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 Airthings ASA are associated (or correlated) with Exact Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exact Therapeutics has no effect on the direction of Airthings ASA i.e., Airthings ASA and Exact Therapeutics go up and down completely randomly.
Pair Corralation between Airthings ASA and Exact Therapeutics
Assuming the 90 days trading horizon Airthings ASA is expected to generate 0.44 times more return on investment than Exact Therapeutics. However, Airthings ASA is 2.25 times less risky than Exact Therapeutics. It trades about -0.03 of its potential returns per unit of risk. Exact Therapeutics AS is currently generating about -0.06 per unit of risk. If you would invest 230.00 in Airthings ASA on October 20, 2024 and sell it today you would lose (3.00) from holding Airthings ASA or give up 1.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
Airthings ASA vs. Exact Therapeutics AS
Performance |
| Timeline |
| Airthings ASA |
| Exact Therapeutics |
Airthings ASA and Exact Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airthings ASA and Exact Therapeutics
The main advantage of trading using opposite Airthings ASA and Exact Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airthings ASA position performs unexpectedly, Exact Therapeutics 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 Exact Therapeutics will offset losses from the drop in Exact Therapeutics' long position.| Airthings ASA vs. Atlantic Sapphire As | Airthings ASA vs. Vow ASA | Airthings ASA vs. Aker Horizons AS | Airthings ASA vs. Saga Pure ASA |
| Exact Therapeutics vs. Airthings ASA | Exact Therapeutics vs. Aega ASA | Exact Therapeutics vs. Huddly AS | Exact Therapeutics vs. Bergenbio ASA |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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