Correlation Between AKITA Drilling and Gap,
Can any of the company-specific risk be diversified away by investing in both AKITA Drilling and Gap, 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 Gap, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AKITA Drilling and The Gap,, you can compare the effects of market volatilities on AKITA Drilling and Gap, 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 Gap,. Check out your portfolio center. Please also check ongoing floating volatility patterns of AKITA Drilling and Gap,.
Diversification Opportunities for AKITA Drilling and Gap,
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AKITA and Gap, is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding AKITA Drilling and The Gap, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gap, 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 Gap,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gap, has no effect on the direction of AKITA Drilling i.e., AKITA Drilling and Gap, go up and down completely randomly.
Pair Corralation between AKITA Drilling and Gap,
Assuming the 90 days horizon AKITA Drilling is expected to generate 64.32 times less return on investment than Gap,. But when comparing it to its historical volatility, AKITA Drilling is 2.51 times less risky than Gap,. It trades about 0.01 of its potential returns per unit of risk. The Gap, is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 2,161 in The Gap, on September 3, 2024 and sell it today you would earn a total of 264.00 from holding The Gap, or generate 12.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
AKITA Drilling vs. The Gap,
Performance |
| Timeline |
| AKITA Drilling |
| Gap, |
AKITA Drilling and Gap, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AKITA Drilling and Gap,
The main advantage of trading using opposite AKITA Drilling and Gap, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AKITA Drilling position performs unexpectedly, Gap, 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 Gap, will offset losses from the drop in Gap,'s long position.| AKITA Drilling vs. Seadrill Limited | AKITA Drilling vs. Noble plc | AKITA Drilling vs. Borr Drilling | AKITA Drilling vs. SCOR PK |
| Gap, vs. Centessa Pharmaceuticals PLC | Gap, vs. Kandi Technologies Group | Gap, vs. Digi International | Gap, vs. Reservoir Media |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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