Correlation Between STRATA Skin and Ainos

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

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

Diversification Opportunities for STRATA Skin and Ainos

0.39

Correlation Coefficient

STRATA Skin  Ainos

Weak diversification

The 3 months correlation between STRATA and Ainos is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding STRATA Skin Sciences and Ainos Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ainos Inc and STRATA Skin 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 STRATA Skin Sciences 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 STRATA Skin i.e., STRATA Skin and Ainos go up and down completely randomly.

Pair Corralation between STRATA Skin and Ainos

Given the investment horizon of 90 days STRATA Skin Sciences is expected to under-perform the Ainos. But the stock apears to be less risky and, when comparing its historical volatility, STRATA Skin Sciences is 3.04 times less risky than Ainos. The stock trades about -0.03 of its potential returns per unit of risk. The Ainos Inc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  45.00  in Ainos Inc on December 28, 2024 and sell it today you would earn a total of  6.02  from holding Ainos Inc or generate 13.38% return on investment over 90 days.

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

STRATA Skin Sciences  vs.  Ainos Inc

STRATA Skin Sciences

Risk-Adjusted Performance

Very Weak

Over the last 90 days STRATA Skin Sciences has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward-looking signals, STRATA Skin is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Ainos Inc

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ainos Inc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating primary indicators, Ainos exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with STRATA Skin and Ainos

The main advantage of trading using opposite STRATA Skin and Ainos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STRATA Skin 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 STRATA Skin Sciences 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.