Correlation Between Ardelyx and Anterix

Can any of the company-specific risk be diversified away by investing in both Ardelyx and Anterix 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 Ardelyx and Anterix into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ardelyx and Anterix, you can compare the effects of market volatilities on Ardelyx and Anterix 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 Ardelyx with a short position of Anterix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ardelyx and Anterix.

Diversification Opportunities for Ardelyx and Anterix

0.39

Correlation Coefficient

Ardelyx  Anterix

Weak diversification

The 3 months correlation between Ardelyx and Anterix is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Ardelyx and Anterix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anterix and Ardelyx 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 Ardelyx are associated (or correlated) with Anterix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anterix has no effect on the direction of Ardelyx i.e., Ardelyx and Anterix go up and down completely randomly.

Pair Corralation between Ardelyx and Anterix

Given the investment horizon of 90 days Ardelyx is expected to under-perform the Anterix. In addition to that, Ardelyx is 1.84 times more volatile than Anterix. It trades about -0.27 of its total potential returns per unit of risk. Anterix is currently generating about -0.31 per unit of volatility. If you would invest  3,885  in Anterix on February 2, 2024 and sell it today you would lose (685.00) from holding Anterix or give up 17.63% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Ardelyx  vs.  Anterix

Ardelyx

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ardelyx has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in June 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Anterix

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Anterix are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong technical and fundamental indicators, Anterix is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Ardelyx and Anterix

The main advantage of trading using opposite Ardelyx and Anterix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ardelyx position performs unexpectedly, Anterix 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 Anterix will offset losses from the drop in Anterix's long position.

The idea behind Ardelyx and Anterix 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.