Correlation Between AKITA Drilling and SharkNinja,

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

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

Diversification Opportunities for AKITA Drilling and SharkNinja,

0.08

Correlation Coefficient

AKITA Drilling  SharkNinja,

Significant diversification

The 3 months correlation between AKITA and SharkNinja, is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding AKITA Drilling and SharkNinja, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SharkNinja, and AKITA Drilling 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 AKITA Drilling are associated (or correlated) with SharkNinja,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SharkNinja, has no effect on the direction of AKITA Drilling i.e., AKITA Drilling and SharkNinja, go up and down completely randomly.

Pair Corralation between AKITA Drilling and SharkNinja,

Assuming the 90 days horizon AKITA Drilling is expected to generate 3.4 times less return on investment than SharkNinja,. In addition to that, AKITA Drilling is 1.02 times more volatile than SharkNinja,. It trades about 0.04 of its total potential returns per unit of risk. SharkNinja, is currently generating about 0.12 per unit of volatility. If you would invest  4,954  in SharkNinja, on October 6, 2024 and sell it today you would earn a total of  4,902  from holding SharkNinja, or generate 98.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

AKITA Drilling  vs.  SharkNinja,

AKITA Drilling

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AKITA Drilling has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, AKITA Drilling is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

SharkNinja,

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with AKITA Drilling and SharkNinja,

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

The idea behind AKITA Drilling and SharkNinja, 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.