Correlation Between Aker Technology and Sirtec International

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

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

Diversification Opportunities for Aker Technology and Sirtec International

-0.54

Correlation Coefficient

Aker Technology  Sirtec International

Excellent diversification

The 3 months correlation between Aker and Sirtec is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Aker Technology Co and Sirtec International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sirtec International and Aker 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 Aker Technology Co are associated (or correlated) with Sirtec International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sirtec International has no effect on the direction of Aker Technology i.e., Aker Technology and Sirtec International go up and down completely randomly.

Pair Corralation between Aker Technology and Sirtec International

Assuming the 90 days trading horizon Aker Technology is expected to generate 5.01 times less return on investment than Sirtec International. In addition to that, Aker Technology is 1.61 times more volatile than Sirtec International Co. It trades about 0.01 of its total potential returns per unit of risk. Sirtec International Co is currently generating about 0.08 per unit of volatility. If you would invest  1,835  in Sirtec International Co on October 11, 2024 and sell it today you would earn a total of  1,195  from holding Sirtec International Co or generate 65.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	99.79%
Values	Daily Returns

Aker Technology Co  vs.  Sirtec International Co

Aker Technology

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Aker Technology Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Aker Technology is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Sirtec International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sirtec International Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Aker Technology and Sirtec International

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

The idea behind Aker Technology Co and Sirtec International 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.