Correlation Between SANUWAVE Health and Ainos
Can any of the company-specific risk be diversified away by investing in both SANUWAVE Health and Ainos 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 SANUWAVE Health and Ainos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SANUWAVE Health and Ainos Inc, you can compare the effects of market volatilities on SANUWAVE Health and Ainos 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 SANUWAVE Health with a short position of Ainos. Check out your portfolio center. Please also check ongoing floating volatility patterns of SANUWAVE Health and Ainos.
Diversification Opportunities for SANUWAVE Health and Ainos
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SANUWAVE and Ainos is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding SANUWAVE Health and Ainos Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ainos Inc and SANUWAVE Health 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 SANUWAVE Health are associated (or correlated) with Ainos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ainos Inc has no effect on the direction of SANUWAVE Health i.e., SANUWAVE Health and Ainos go up and down completely randomly.
Pair Corralation between SANUWAVE Health and Ainos
Given the investment horizon of 90 days SANUWAVE Health is expected to generate 2.91 times less return on investment than Ainos. But when comparing it to its historical volatility, SANUWAVE Health is 4.65 times less risky than Ainos. It trades about 0.28 of its potential returns per unit of risk. Ainos Inc is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 44.00 in Ainos Inc on October 20, 2024 and sell it today you would earn a total of 19.00 from holding Ainos Inc or generate 43.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SANUWAVE Health vs. Ainos Inc
Performance |
| Timeline |
| SANUWAVE Health |
| Ainos Inc |
SANUWAVE Health and Ainos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SANUWAVE Health and Ainos
The main advantage of trading using opposite SANUWAVE Health and Ainos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SANUWAVE Health position performs unexpectedly, Ainos 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 Ainos will offset losses from the drop in Ainos' long position.| SANUWAVE Health vs. Rafarma Pharmaceuticals | SANUWAVE Health vs. GulfSlope Energy | SANUWAVE Health vs. TSS, Common Stock |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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