Correlation Between Automata and Ankr Network

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

Diversification Opportunities for Automata and Ankr Network

0.94
  Correlation Coefficient

Almost no diversification

The 3 months correlation between Automata and Ankr is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Automata and Ankr Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ankr Network and Automata 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 Automata are associated (or correlated) with Ankr Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ankr Network has no effect on the direction of Automata i.e., Automata and Ankr Network go up and down completely randomly.

Pair Corralation between Automata and Ankr Network

Assuming the 90 days trading horizon Automata is expected to generate 6.94 times more return on investment than Ankr Network. However, Automata is 6.94 times more volatile than Ankr Network. It trades about 0.05 of its potential returns per unit of risk. Ankr Network is currently generating about 0.02 per unit of risk. If you would invest  0.00  in Automata on December 29, 2023 and sell it today you would earn a total of  18.00  from holding Automata or generate 9.223372036854776E16% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

Automata  vs.  Ankr Network

 Performance 
       Timeline  
Automata 

Risk-Adjusted Performance

10 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Automata are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Automata exhibited solid returns over the last few months and may actually be approaching a breakup point.
Ankr Network 

Risk-Adjusted Performance

13 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Ankr Network are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Ankr Network exhibited solid returns over the last few months and may actually be approaching a breakup point.

Automata and Ankr Network Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Automata and Ankr Network

The main advantage of trading using opposite Automata and Ankr Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Automata position performs unexpectedly, Ankr Network 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 Ankr Network will offset losses from the drop in Ankr Network's long position.
The idea behind Automata and Ankr Network 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.
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.

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