Correlation Between Aethlon Medical and 90041LAF2

Can any of the company-specific risk be diversified away by investing in both Aethlon Medical and 90041LAF2 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 Aethlon Medical and 90041LAF2 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Aethlon Medical and US90041LAF22, you can compare the effects of market volatilities on Aethlon Medical and 90041LAF2 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 Aethlon Medical with a short position of 90041LAF2. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aethlon Medical and 90041LAF2.

Diversification Opportunities for Aethlon Medical and 90041LAF2

-0.13

Correlation Coefficient

Aethlon Medical  90041LAF2

Good diversification

The 3 months correlation between Aethlon and 90041LAF2 is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Aethlon Medical and US90041LAF22 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US90041LAF22 and Aethlon Medical 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 Aethlon Medical are associated (or correlated) with 90041LAF2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US90041LAF22 has no effect on the direction of Aethlon Medical i.e., Aethlon Medical and 90041LAF2 go up and down completely randomly.

Pair Corralation between Aethlon Medical and 90041LAF2

If you would invest  43.00  in Aethlon Medical on October 24, 2024 and sell it today you would earn a total of  22.00  from holding Aethlon Medical or generate 51.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	41.98%
Values	Daily Returns

Aethlon Medical  vs.  US90041LAF22

Aethlon Medical

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aethlon Medical are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady primary indicators, Aethlon Medical exhibited solid returns over the last few months and may actually be approaching a breakup point.

US90041LAF22

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in US90041LAF22 are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 90041LAF2 is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Aethlon Medical and 90041LAF2

The main advantage of trading using opposite Aethlon Medical and 90041LAF2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aethlon Medical position performs unexpectedly, 90041LAF2 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 90041LAF2 will offset losses from the drop in 90041LAF2's long position.

The idea behind Aethlon Medical and US90041LAF22 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.