Correlation Between 26442UAM6 and AKITA Drilling

Can any of the company-specific risk be diversified away by investing in both 26442UAM6 and AKITA Drilling 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 26442UAM6 and AKITA Drilling into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between DUK 29 15 AUG 51 and AKITA Drilling, you can compare the effects of market volatilities on 26442UAM6 and AKITA Drilling 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 26442UAM6 with a short position of AKITA Drilling. Check out your portfolio center. Please also check ongoing floating volatility patterns of 26442UAM6 and AKITA Drilling.

Diversification Opportunities for 26442UAM6 and AKITA Drilling

-0.16

Correlation Coefficient

26442UAM6  AKITA Drilling

Good diversification

The 3 months correlation between 26442UAM6 and AKITA is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding DUK 29 15 AUG 51 and AKITA Drilling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AKITA Drilling and 26442UAM6 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 DUK 29 15 AUG 51 are associated (or correlated) with AKITA Drilling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AKITA Drilling has no effect on the direction of 26442UAM6 i.e., 26442UAM6 and AKITA Drilling go up and down completely randomly.

Pair Corralation between 26442UAM6 and AKITA Drilling

Assuming the 90 days trading horizon 26442UAM6 is expected to generate 2.18 times less return on investment than AKITA Drilling. In addition to that, 26442UAM6 is 1.24 times more volatile than AKITA Drilling. It trades about 0.05 of its total potential returns per unit of risk. AKITA Drilling is currently generating about 0.13 per unit of volatility. If you would invest  110.00  in AKITA Drilling on December 24, 2024 and sell it today you would earn a total of  23.00  from holding AKITA Drilling or generate 20.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	59.02%
Values	Daily Returns

DUK 29 15 AUG 51  vs.  AKITA Drilling

DUK 29 15

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in DUK 29 15 AUG 51 are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, 26442UAM6 may actually be approaching a critical reversion point that can send shares even higher in April 2025.

AKITA Drilling

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AKITA Drilling are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, AKITA Drilling reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with 26442UAM6 and AKITA Drilling

The main advantage of trading using opposite 26442UAM6 and AKITA Drilling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 26442UAM6 position performs unexpectedly, AKITA Drilling 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 AKITA Drilling will offset losses from the drop in AKITA Drilling's long position.

The idea behind DUK 29 15 AUG 51 and AKITA Drilling 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 CEOs Directory module to screen CEOs from public companies around the world.