Correlation Between Apple and Akoustis Technologies
Can any of the company-specific risk be diversified away by investing in both Apple and Akoustis Technologies 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 Apple and Akoustis Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and Akoustis Technologies, you can compare the effects of market volatilities on Apple and Akoustis Technologies 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 Apple with a short position of Akoustis Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Akoustis Technologies.
Diversification Opportunities for Apple and Akoustis Technologies
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Apple and Akoustis is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Akoustis Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akoustis Technologies and Apple 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 Apple Inc are associated (or correlated) with Akoustis Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akoustis Technologies has no effect on the direction of Apple i.e., Apple and Akoustis Technologies go up and down completely randomly.
Pair Corralation between Apple and Akoustis Technologies
Given the investment horizon of 90 days Apple Inc is expected to generate 0.29 times more return on investment than Akoustis Technologies. However, Apple Inc is 3.44 times less risky than Akoustis Technologies. It trades about 0.02 of its potential returns per unit of risk. Akoustis Technologies is currently generating about -0.04 per unit of risk. If you would invest 15,500 in Apple Inc on January 25, 2024 and sell it today you would earn a total of 1,190 from holding Apple Inc or generate 7.68% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Apple Inc vs. Akoustis Technologies
Performance |
Timeline |
Apple Inc |
Akoustis Technologies |
Apple and Akoustis Technologies Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Apple and Akoustis Technologies
The main advantage of trading using opposite Apple and Akoustis Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Akoustis Technologies 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 Akoustis Technologies will offset losses from the drop in Akoustis Technologies' long position.The idea behind Apple Inc and Akoustis Technologies 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.Akoustis Technologies vs. Aviat Networks | Akoustis Technologies vs. AudioCodes | Akoustis Technologies vs. Silicom | Akoustis Technologies vs. Gilat Satellite Networks |
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.
Other Complementary Tools
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |