Correlation Between Sphere 3D and Aterian
Can any of the company-specific risk be diversified away by investing in both Sphere 3D and Aterian 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 Sphere 3D and Aterian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sphere 3D Corp and Aterian, you can compare the effects of market volatilities on Sphere 3D and Aterian 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 Sphere 3D with a short position of Aterian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sphere 3D and Aterian.
Diversification Opportunities for Sphere 3D and Aterian
Very weak diversification
The 3 months correlation between Sphere and Aterian is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Sphere 3D Corp and Aterian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aterian and Sphere 3D 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 Sphere 3D Corp are associated (or correlated) with Aterian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aterian has no effect on the direction of Sphere 3D i.e., Sphere 3D and Aterian go up and down completely randomly.
Pair Corralation between Sphere 3D and Aterian
Considering the 90-day investment horizon Sphere 3D Corp is expected to generate 2.28 times more return on investment than Aterian. However, Sphere 3D is 2.28 times more volatile than Aterian. It trades about -0.12 of its potential returns per unit of risk. Aterian is currently generating about -0.28 per unit of risk. If you would invest 101.00 in Sphere 3D Corp on November 2, 2024 and sell it today you would lose (13.00) from holding Sphere 3D Corp or give up 12.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sphere 3D Corp vs. Aterian
Performance |
| Timeline |
| Sphere 3D Corp |
| Aterian |
Sphere 3D and Aterian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sphere 3D and Aterian
The main advantage of trading using opposite Sphere 3D and Aterian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sphere 3D position performs unexpectedly, Aterian 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 Aterian will offset losses from the drop in Aterian's long position.| Sphere 3D vs. Society Pass | Sphere 3D vs. Marin Software | Sphere 3D vs. EzFill Holdings | Sphere 3D vs. Trust Stamp |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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