Correlation Between AST SpaceMobile and IONQ WT

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

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

Diversification Opportunities for AST SpaceMobile and IONQ WT

-0.34

Correlation Coefficient

AST SpaceMobile  IONQ WT

Very good diversification

The 3 months correlation between AST and IONQ is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding AST SpaceMobile and IONQ WT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IONQ WT and AST SpaceMobile 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 AST SpaceMobile are associated (or correlated) with IONQ WT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IONQ WT has no effect on the direction of AST SpaceMobile i.e., AST SpaceMobile and IONQ WT go up and down completely randomly.

Pair Corralation between AST SpaceMobile and IONQ WT

Assuming the 90 days horizon AST SpaceMobile is expected to generate 1.16 times less return on investment than IONQ WT. In addition to that, AST SpaceMobile is 1.03 times more volatile than IONQ WT. It trades about 0.12 of its total potential returns per unit of risk. IONQ WT is currently generating about 0.15 per unit of volatility. If you would invest  2,279  in IONQ WT on October 26, 2024 and sell it today you would earn a total of  780.00  from holding IONQ WT or generate 34.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	66.67%
Values	Daily Returns

AST SpaceMobile  vs.  IONQ WT

AST SpaceMobile

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AST SpaceMobile has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, AST SpaceMobile is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

IONQ WT

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in IONQ WT are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, IONQ WT unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AST SpaceMobile and IONQ WT

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

The idea behind AST SpaceMobile and IONQ WT 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.