Correlation Between Identiv and Ageagle Aerial

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Can any of the company-specific risk be diversified away by investing in both Identiv and Ageagle Aerial 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 Identiv and Ageagle Aerial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Identiv and Ageagle Aerial Systems, you can compare the effects of market volatilities on Identiv and Ageagle Aerial 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 Identiv with a short position of Ageagle Aerial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Identiv and Ageagle Aerial.

Diversification Opportunities for Identiv and Ageagle Aerial

-0.65
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Identiv and Ageagle is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Identiv and Ageagle Aerial Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ageagle Aerial Systems and Identiv 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 Identiv are associated (or correlated) with Ageagle Aerial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ageagle Aerial Systems has no effect on the direction of Identiv i.e., Identiv and Ageagle Aerial go up and down completely randomly.

Pair Corralation between Identiv and Ageagle Aerial

Given the investment horizon of 90 days Identiv is expected to generate 10.79 times less return on investment than Ageagle Aerial. But when comparing it to its historical volatility, Identiv is 9.98 times less risky than Ageagle Aerial. It trades about 0.2 of its potential returns per unit of risk. Ageagle Aerial Systems is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  269.00  in Ageagle Aerial Systems on August 27, 2024 and sell it today you would earn a total of  328.00  from holding Ageagle Aerial Systems or generate 121.93% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Identiv  vs.  Ageagle Aerial Systems

 Performance 
       Timeline  
Identiv 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Identiv are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Identiv exhibited solid returns over the last few months and may actually be approaching a breakup point.
Ageagle Aerial Systems 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Ageagle Aerial Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Identiv and Ageagle Aerial Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Identiv and Ageagle Aerial

The main advantage of trading using opposite Identiv and Ageagle Aerial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Identiv position performs unexpectedly, Ageagle Aerial 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 Ageagle Aerial will offset losses from the drop in Ageagle Aerial's long position.
The idea behind Identiv and Ageagle Aerial Systems pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.

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