Correlation Between Employers Holdings and Ainos

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

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

Diversification Opportunities for Employers Holdings and Ainos

-0.6

Correlation Coefficient

Employers Holdings  Ainos

Excellent diversification

The 3 months correlation between Employers and Ainos is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Employers Holdings and Ainos Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ainos Inc and Employers Holdings 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 Employers Holdings are associated (or correlated) with Ainos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ainos Inc has no effect on the direction of Employers Holdings i.e., Employers Holdings and Ainos go up and down completely randomly.

Pair Corralation between Employers Holdings and Ainos

Considering the 90-day investment horizon Employers Holdings is expected to generate 573.82 times less return on investment than Ainos. But when comparing it to its historical volatility, Employers Holdings is 216.14 times less risky than Ainos. It trades about 0.11 of its potential returns per unit of risk. Ainos Inc is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest  7.00  in Ainos Inc on September 23, 2024 and sell it today you would lose (4.08) from holding Ainos Inc or give up 58.29% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	22.83%
Values	Daily Returns

Employers Holdings  vs.  Ainos Inc

Employers Holdings

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Employers Holdings are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent forward indicators, Employers Holdings may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Ainos Inc

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Ainos Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly fragile fundamental indicators, Ainos showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Employers Holdings and Ainos

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

The idea behind Employers Holdings and Ainos Inc 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.