Correlation Between Nasdaq and Akash Network

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

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

Diversification Opportunities for Nasdaq and Akash Network

0.88

Correlation Coefficient

Nasdaq  Akash Network

Very poor diversification

The 3 months correlation between Nasdaq and Akash is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc and Akash Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akash Network and Nasdaq 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 Nasdaq Inc are associated (or correlated) with Akash Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akash Network has no effect on the direction of Nasdaq i.e., Nasdaq and Akash Network go up and down completely randomly.

Pair Corralation between Nasdaq and Akash Network

Given the investment horizon of 90 days Nasdaq Inc is expected to generate 0.18 times more return on investment than Akash Network. However, Nasdaq Inc is 5.45 times less risky than Akash Network. It trades about 0.14 of its potential returns per unit of risk. Akash Network is currently generating about 0.0 per unit of risk. If you would invest  5,318  in Nasdaq Inc on September 14, 2024 and sell it today you would earn a total of  2,694  from holding Nasdaq Inc or generate 50.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	55.39%
Values	Daily Returns

Nasdaq Inc  vs.  Akash Network

Nasdaq Inc

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nasdaq Inc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Nasdaq may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Akash Network

Risk-Adjusted Performance

11 of 100

Good

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

Pair Trading with Nasdaq and Akash Network

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

The idea behind Nasdaq Inc and Akash Network 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.