Correlation Between AKITA Drilling and Thinkific Labs
Can any of the company-specific risk be diversified away by investing in both AKITA Drilling and Thinkific Labs 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 AKITA Drilling and Thinkific Labs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AKITA Drilling and Thinkific Labs, you can compare the effects of market volatilities on AKITA Drilling and Thinkific Labs 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 AKITA Drilling with a short position of Thinkific Labs. Check out your portfolio center. Please also check ongoing floating volatility patterns of AKITA Drilling and Thinkific Labs.
Diversification Opportunities for AKITA Drilling and Thinkific Labs
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AKITA and Thinkific is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding AKITA Drilling and Thinkific Labs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thinkific Labs and AKITA Drilling 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 AKITA Drilling are associated (or correlated) with Thinkific Labs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thinkific Labs has no effect on the direction of AKITA Drilling i.e., AKITA Drilling and Thinkific Labs go up and down completely randomly.
Pair Corralation between AKITA Drilling and Thinkific Labs
Assuming the 90 days trading horizon AKITA Drilling is expected to generate 0.77 times more return on investment than Thinkific Labs. However, AKITA Drilling is 1.31 times less risky than Thinkific Labs. It trades about 0.04 of its potential returns per unit of risk. Thinkific Labs is currently generating about 0.01 per unit of risk. If you would invest 139.00 in AKITA Drilling on September 4, 2024 and sell it today you would earn a total of 24.00 from holding AKITA Drilling or generate 17.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AKITA Drilling vs. Thinkific Labs
Performance |
| Timeline |
| AKITA Drilling |
| Thinkific Labs |
AKITA Drilling and Thinkific Labs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AKITA Drilling and Thinkific Labs
The main advantage of trading using opposite AKITA Drilling and Thinkific Labs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AKITA Drilling position performs unexpectedly, Thinkific Labs 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 Thinkific Labs will offset losses from the drop in Thinkific Labs' long position.| AKITA Drilling vs. STEP Energy Services | AKITA Drilling vs. Southern Energy Corp | AKITA Drilling vs. PHX Energy Services | AKITA Drilling vs. iShares Canadian HYBrid |
| Thinkific Labs vs. Brookfield Asset Management | Thinkific Labs vs. Cogeco Communications | Thinkific Labs vs. Hemisphere Energy | Thinkific Labs vs. AKITA Drilling |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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