Correlation Between Awakn Life and Accustem Sciences

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

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

Diversification Opportunities for Awakn Life and Accustem Sciences

0.11

Correlation Coefficient

Awakn Life  Accustem Sciences

Average diversification

The 3 months correlation between Awakn and Accustem is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Awakn Life Sciences and Accustem Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accustem Sciences and Awakn Life 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 Awakn Life Sciences are associated (or correlated) with Accustem Sciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accustem Sciences has no effect on the direction of Awakn Life i.e., Awakn Life and Accustem Sciences go up and down completely randomly.

Pair Corralation between Awakn Life and Accustem Sciences

Assuming the 90 days horizon Awakn Life is expected to generate 1.07 times less return on investment than Accustem Sciences. In addition to that, Awakn Life is 1.03 times more volatile than Accustem Sciences. It trades about 0.05 of its total potential returns per unit of risk. Accustem Sciences is currently generating about 0.05 per unit of volatility. If you would invest  87.00  in Accustem Sciences on October 12, 2024 and sell it today you would lose (42.00) from holding Accustem Sciences or give up 48.28% of portfolio value over 90 days.

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

Awakn Life Sciences  vs.  Accustem Sciences

Awakn Life Sciences

Risk-Adjusted Performance

0 of 100

Very Weak

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

Accustem Sciences

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Accustem Sciences are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Accustem Sciences unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Awakn Life and Accustem Sciences

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

The idea behind Awakn Life Sciences and Accustem Sciences 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.