Correlation Between Aterian and Deer Consumer

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

Diversification Opportunities for Aterian and Deer Consumer

0.39
  Correlation Coefficient

Weak diversification

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

Pair Corralation between Aterian and Deer Consumer

If you would invest  0.02  in Deer Consumer Prodct on December 29, 2023 and sell it today you would earn a total of  0.00  from holding Deer Consumer Prodct or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy4.55%
ValuesDaily Returns

Aterian  vs.  Deer Consumer Prodct

 Performance 
       Timeline  
Aterian 

Risk-Adjusted Performance

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Low
 
High
Very Weak
Over the last 90 days Aterian has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in April 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.
Deer Consumer Prodct 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Deer Consumer Prodct has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, Deer Consumer is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Aterian and Deer Consumer Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Aterian and Deer Consumer

The main advantage of trading using opposite Aterian and Deer Consumer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aterian position performs unexpectedly, Deer Consumer 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 Deer Consumer will offset losses from the drop in Deer Consumer's long position.
The idea behind Aterian and Deer Consumer Prodct 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.

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