Correlation Between Akoustis Technologies and Lumen Technologies
Can any of the company-specific risk be diversified away by investing in both Akoustis Technologies and Lumen Technologies 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 Akoustis Technologies and Lumen Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akoustis Technologies and Lumen Technologies, you can compare the effects of market volatilities on Akoustis Technologies and Lumen Technologies 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 Akoustis Technologies with a short position of Lumen Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akoustis Technologies and Lumen Technologies.
Diversification Opportunities for Akoustis Technologies and Lumen Technologies
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Akoustis and Lumen is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Akoustis Technologies and Lumen Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lumen Technologies and Akoustis Technologies 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 Akoustis Technologies are associated (or correlated) with Lumen Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lumen Technologies has no effect on the direction of Akoustis Technologies i.e., Akoustis Technologies and Lumen Technologies go up and down completely randomly.
Pair Corralation between Akoustis Technologies and Lumen Technologies
Given the investment horizon of 90 days Akoustis Technologies is expected to under-perform the Lumen Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Akoustis Technologies is 1.33 times less risky than Lumen Technologies. The stock trades about -0.02 of its potential returns per unit of risk. The Lumen Technologies is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 129.00 in Lumen Technologies on September 1, 2024 and sell it today you would earn a total of 605.00 from holding Lumen Technologies or generate 468.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Akoustis Technologies vs. Lumen Technologies
Performance |
| Timeline |
| Akoustis Technologies |
| Lumen Technologies |
Akoustis Technologies and Lumen Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akoustis Technologies and Lumen Technologies
The main advantage of trading using opposite Akoustis Technologies and Lumen Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akoustis Technologies position performs unexpectedly, Lumen Technologies 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 Lumen Technologies will offset losses from the drop in Lumen Technologies' long position.| Akoustis Technologies vs. Aviat Networks | Akoustis Technologies vs. AudioCodes | Akoustis Technologies vs. Silicom | Akoustis Technologies vs. Gilat Satellite Networks |
| Lumen Technologies vs. Verizon Communications | Lumen Technologies vs. T Mobile | Lumen Technologies vs. Comcast Corp | Lumen Technologies vs. ATT Inc |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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