Correlation Between Alpha Healthcare and Micro Imaging

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

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

Diversification Opportunities for Alpha Healthcare and Micro Imaging

0.0

Correlation Coefficient

Alpha Healthcare  Micro Imaging

Pay attention - limited upside

The 3 months correlation between Alpha and Micro is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Healthcare Acquisition and Micro Imaging Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Micro Imaging Technology and Alpha Healthcare 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 Alpha Healthcare Acquisition are associated (or correlated) with Micro Imaging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Micro Imaging Technology has no effect on the direction of Alpha Healthcare i.e., Alpha Healthcare and Micro Imaging go up and down completely randomly.

Pair Corralation between Alpha Healthcare and Micro Imaging

If you would invest  0.01  in Micro Imaging Technology on October 24, 2024 and sell it today you would earn a total of  0.00  from holding Micro Imaging Technology or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

Alpha Healthcare Acquisition  vs.  Micro Imaging Technology

Alpha Healthcare Acq

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alpha Healthcare Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Alpha Healthcare is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Micro Imaging Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Micro Imaging Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Micro Imaging is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Alpha Healthcare and Micro Imaging

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

The idea behind Alpha Healthcare Acquisition and Micro Imaging Technology 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.

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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.