Correlation Between AtriCure and Akoya Biosciences

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

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

Diversification Opportunities for AtriCure and Akoya Biosciences

0.34

Correlation Coefficient

AtriCure  Akoya Biosciences

Weak diversification

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

Pair Corralation between AtriCure and Akoya Biosciences

Given the investment horizon of 90 days AtriCure is expected to generate 0.69 times more return on investment than Akoya Biosciences. However, AtriCure is 1.44 times less risky than Akoya Biosciences. It trades about 0.04 of its potential returns per unit of risk. Akoya Biosciences is currently generating about -0.14 per unit of risk. If you would invest  3,025  in AtriCure on December 29, 2024 and sell it today you would earn a total of  158.00  from holding AtriCure or generate 5.22% return on investment over 90 days.

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

AtriCure  vs.  Akoya Biosciences

AtriCure

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in AtriCure are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, AtriCure may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Akoya Biosciences

Risk-Adjusted Performance

Very Weak

Over the last 90 days Akoya Biosciences has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with AtriCure and Akoya Biosciences

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

The idea behind AtriCure and Akoya Biosciences 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.