Correlation Between Imeik Technology and Andon Health

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

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

Diversification Opportunities for Imeik Technology and Andon Health

0.62

Correlation Coefficient

Imeik Technology  Andon Health

Poor diversification

The 3 months correlation between Imeik and Andon is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Imeik Technology Development and Andon Health Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Andon Health and Imeik Technology 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 Imeik Technology Development are associated (or correlated) with Andon Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Andon Health has no effect on the direction of Imeik Technology i.e., Imeik Technology and Andon Health go up and down completely randomly.

Pair Corralation between Imeik Technology and Andon Health

Assuming the 90 days trading horizon Imeik Technology Development is expected to generate 2.2 times more return on investment than Andon Health. However, Imeik Technology is 2.2 times more volatile than Andon Health Co. It trades about 0.04 of its potential returns per unit of risk. Andon Health Co is currently generating about -0.18 per unit of risk. If you would invest  20,220  in Imeik Technology Development on September 25, 2024 and sell it today you would earn a total of  265.00  from holding Imeik Technology Development or generate 1.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.45%
Values	Daily Returns

Imeik Technology Development  vs.  Andon Health Co

Imeik Technology Dev

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Imeik Technology Development are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Imeik Technology sustained solid returns over the last few months and may actually be approaching a breakup point.

Andon Health

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Andon Health Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Andon Health is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Imeik Technology and Andon Health

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

The idea behind Imeik Technology Development and Andon Health Co 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.