Correlation Between AmpliTech and D Wave

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

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

Diversification Opportunities for AmpliTech and D Wave

0.02

Correlation Coefficient

AmpliTech  D Wave

Significant diversification

The 3 months correlation between AmpliTech and QBTS is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding AmpliTech Group and D Wave Quantum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on D Wave Quantum and AmpliTech 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 AmpliTech Group are associated (or correlated) with D Wave. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of D Wave Quantum has no effect on the direction of AmpliTech i.e., AmpliTech and D Wave go up and down completely randomly.

Pair Corralation between AmpliTech and D Wave

Assuming the 90 days horizon AmpliTech Group is expected to under-perform the D Wave. In addition to that, AmpliTech is 1.29 times more volatile than D Wave Quantum. It trades about -0.01 of its total potential returns per unit of risk. D Wave Quantum is currently generating about 0.04 per unit of volatility. If you would invest  930.00  in D Wave Quantum on December 29, 2024 and sell it today you would lose (172.00) from holding D Wave Quantum or give up 18.49% of portfolio value over 90 days.

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

AmpliTech Group  vs.  D Wave Quantum

AmpliTech Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days AmpliTech Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's technical and fundamental indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

D Wave Quantum

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in D Wave Quantum are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, D Wave unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AmpliTech and D Wave

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

The idea behind AmpliTech Group and D Wave Quantum 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.