Correlation Between Axon Enterprise and Sassy Resources
Can any of the company-specific risk be diversified away by investing in both Axon Enterprise and Sassy Resources 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 Axon Enterprise and Sassy Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axon Enterprise and Sassy Resources, you can compare the effects of market volatilities on Axon Enterprise and Sassy Resources 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 Axon Enterprise with a short position of Sassy Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axon Enterprise and Sassy Resources.
Diversification Opportunities for Axon Enterprise and Sassy Resources
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Axon and Sassy is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Axon Enterprise and Sassy Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sassy Resources and Axon Enterprise 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 Axon Enterprise are associated (or correlated) with Sassy Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sassy Resources has no effect on the direction of Axon Enterprise i.e., Axon Enterprise and Sassy Resources go up and down completely randomly.
Pair Corralation between Axon Enterprise and Sassy Resources
Given the investment horizon of 90 days Axon Enterprise is expected to generate 3.72 times less return on investment than Sassy Resources. But when comparing it to its historical volatility, Axon Enterprise is 7.07 times less risky than Sassy Resources. It trades about 0.07 of its potential returns per unit of risk. Sassy Resources is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 47.00 in Sassy Resources on November 27, 2024 and sell it today you would lose (41.80) from holding Sassy Resources or give up 88.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.4% |
| Values | Daily Returns |
Axon Enterprise vs. Sassy Resources
Performance |
| Timeline |
| Axon Enterprise |
| Sassy Resources |
Axon Enterprise and Sassy Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axon Enterprise and Sassy Resources
The main advantage of trading using opposite Axon Enterprise and Sassy Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axon Enterprise position performs unexpectedly, Sassy Resources 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 Sassy Resources will offset losses from the drop in Sassy Resources' long position.| Axon Enterprise vs. Novocure | Axon Enterprise vs. HubSpot | Axon Enterprise vs. DigitalOcean Holdings | Axon Enterprise vs. Appian Corp |
| Sassy Resources vs. Pan Global Resources | Sassy Resources vs. Tower Resources | Sassy Resources vs. Metals X Limited | Sassy Resources vs. Nevada King Gold |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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