Correlation Between Charter Communications and AIM ImmunoTech

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

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

Diversification Opportunities for Charter Communications and AIM ImmunoTech

-0.18

Correlation Coefficient

Charter Communications  AIM ImmunoTech

Good diversification

The 3 months correlation between Charter and AIM is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Charter Communications Cl and AIM ImmunoTech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIM ImmunoTech and Charter Communications 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 Charter Communications Cl are associated (or correlated) with AIM ImmunoTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIM ImmunoTech has no effect on the direction of Charter Communications i.e., Charter Communications and AIM ImmunoTech go up and down completely randomly.

Pair Corralation between Charter Communications and AIM ImmunoTech

Assuming the 90 days trading horizon Charter Communications Cl is expected to under-perform the AIM ImmunoTech. But the stock apears to be less risky and, when comparing its historical volatility, Charter Communications Cl is 3.12 times less risky than AIM ImmunoTech. The stock trades about -0.13 of its potential returns per unit of risk. The AIM ImmunoTech is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  19.00  in AIM ImmunoTech on October 20, 2024 and sell it today you would earn a total of  1.00  from holding AIM ImmunoTech or generate 5.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Charter Communications Cl  vs.  AIM ImmunoTech

Charter Communications

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Charter Communications Cl are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Charter Communications may actually be approaching a critical reversion point that can send shares even higher in February 2025.

AIM ImmunoTech

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AIM ImmunoTech has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Charter Communications and AIM ImmunoTech

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

The idea behind Charter Communications Cl and AIM ImmunoTech 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.