Correlation Between Airship AI and Abcellera Biologics

Can any of the company-specific risk be diversified away by investing in both Airship AI and Abcellera Biologics 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 Airship AI and Abcellera Biologics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Airship AI Holdings and Abcellera Biologics, you can compare the effects of market volatilities on Airship AI and Abcellera Biologics 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 Airship AI with a short position of Abcellera Biologics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airship AI and Abcellera Biologics.

Diversification Opportunities for Airship AI and Abcellera Biologics

0.6

Correlation Coefficient

Airship AI  Abcellera Biologics

Poor diversification

The 3 months correlation between Airship and Abcellera is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Airship AI Holdings and Abcellera Biologics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abcellera Biologics and Airship AI 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 Airship AI Holdings are associated (or correlated) with Abcellera Biologics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abcellera Biologics has no effect on the direction of Airship AI i.e., Airship AI and Abcellera Biologics go up and down completely randomly.

Pair Corralation between Airship AI and Abcellera Biologics

Given the investment horizon of 90 days Airship AI is expected to generate 6.24 times less return on investment than Abcellera Biologics. In addition to that, Airship AI is 1.53 times more volatile than Abcellera Biologics. It trades about 0.02 of its total potential returns per unit of risk. Abcellera Biologics is currently generating about 0.22 per unit of volatility. If you would invest  292.00  in Abcellera Biologics on October 24, 2024 and sell it today you would earn a total of  66.00  from holding Abcellera Biologics or generate 22.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Airship AI Holdings  vs.  Abcellera Biologics

Airship AI Holdings

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Airship AI Holdings are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain basic indicators, Airship AI reported solid returns over the last few months and may actually be approaching a breakup point.

Abcellera Biologics

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Abcellera Biologics are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental indicators, Abcellera Biologics disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Airship AI and Abcellera Biologics

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

The idea behind Airship AI Holdings and Abcellera Biologics 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.