Correlation Between Acumen Pharmaceuticals and KVH Industries
Can any of the company-specific risk be diversified away by investing in both Acumen Pharmaceuticals and KVH Industries 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 Acumen Pharmaceuticals and KVH Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acumen Pharmaceuticals and KVH Industries, you can compare the effects of market volatilities on Acumen Pharmaceuticals and KVH Industries 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 Acumen Pharmaceuticals with a short position of KVH Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acumen Pharmaceuticals and KVH Industries.
Diversification Opportunities for Acumen Pharmaceuticals and KVH Industries
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Acumen and KVH is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Acumen Pharmaceuticals and KVH Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KVH Industries and Acumen Pharmaceuticals 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 Acumen Pharmaceuticals are associated (or correlated) with KVH Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KVH Industries has no effect on the direction of Acumen Pharmaceuticals i.e., Acumen Pharmaceuticals and KVH Industries go up and down completely randomly.
Pair Corralation between Acumen Pharmaceuticals and KVH Industries
Given the investment horizon of 90 days Acumen Pharmaceuticals is expected to under-perform the KVH Industries. In addition to that, Acumen Pharmaceuticals is 2.12 times more volatile than KVH Industries. It trades about -0.25 of its total potential returns per unit of risk. KVH Industries is currently generating about 0.02 per unit of volatility. If you would invest 575.00 in KVH Industries on December 1, 2024 and sell it today you would earn a total of 8.00 from holding KVH Industries or generate 1.39% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Acumen Pharmaceuticals vs. KVH Industries
Performance |
Timeline |
Acumen Pharmaceuticals |
KVH Industries |
Acumen Pharmaceuticals and KVH Industries Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Acumen Pharmaceuticals and KVH Industries
The main advantage of trading using opposite Acumen Pharmaceuticals and KVH Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acumen Pharmaceuticals position performs unexpectedly, KVH Industries 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 KVH Industries will offset losses from the drop in KVH Industries' long position.Acumen Pharmaceuticals vs. Terns Pharmaceuticals | Acumen Pharmaceuticals vs. X4 Pharmaceuticals | Acumen Pharmaceuticals vs. Day One Biopharmaceuticals | Acumen Pharmaceuticals vs. Hookipa Pharma |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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