Correlation Between AcelRx Pharmaceuticals and Alpha Teknova

Can any of the company-specific risk be diversified away by investing in both AcelRx Pharmaceuticals and Alpha Teknova 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 AcelRx Pharmaceuticals and Alpha Teknova into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AcelRx Pharmaceuticals and Alpha Teknova, you can compare the effects of market volatilities on AcelRx Pharmaceuticals and Alpha Teknova 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 AcelRx Pharmaceuticals with a short position of Alpha Teknova. Check out your portfolio center. Please also check ongoing floating volatility patterns of AcelRx Pharmaceuticals and Alpha Teknova.

Diversification Opportunities for AcelRx Pharmaceuticals and Alpha Teknova

0.8

Correlation Coefficient

AcelRx Pharmaceuticals  Alpha Teknova

Very poor diversification

The 3 months correlation between AcelRx and Alpha is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding AcelRx Pharmaceuticals and Alpha Teknova in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpha Teknova and AcelRx 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 AcelRx Pharmaceuticals are associated (or correlated) with Alpha Teknova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpha Teknova has no effect on the direction of AcelRx Pharmaceuticals i.e., AcelRx Pharmaceuticals and Alpha Teknova go up and down completely randomly.

Pair Corralation between AcelRx Pharmaceuticals and Alpha Teknova

If you would invest  455.00  in Alpha Teknova on September 3, 2024 and sell it today you would earn a total of  292.00  from holding Alpha Teknova or generate 64.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	1.56%
Values	Daily Returns

AcelRx Pharmaceuticals  vs.  Alpha Teknova

AcelRx Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AcelRx Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, AcelRx Pharmaceuticals is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Alpha Teknova

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Alpha Teknova are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting basic indicators, Alpha Teknova displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AcelRx Pharmaceuticals and Alpha Teknova

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

The idea behind AcelRx Pharmaceuticals and Alpha Teknova 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.