Correlation Between Acumen Pharmaceuticals and Ainos

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

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

Diversification Opportunities for Acumen Pharmaceuticals and Ainos

-0.23

Correlation Coefficient

Acumen Pharmaceuticals  Ainos

Very good diversification

The 3 months correlation between Acumen and Ainos is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Acumen Pharmaceuticals and Ainos Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ainos Inc and Acumen Pharmaceuticals 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 Acumen Pharmaceuticals 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 Acumen Pharmaceuticals i.e., Acumen Pharmaceuticals and Ainos go up and down completely randomly.

Pair Corralation between Acumen Pharmaceuticals and Ainos

Given the investment horizon of 90 days Acumen Pharmaceuticals is expected to under-perform the Ainos. But the stock apears to be less risky and, when comparing its historical volatility, Acumen Pharmaceuticals is 11.85 times less risky than Ainos. The stock trades about -0.02 of its potential returns per unit of risk. The Ainos Inc is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  4.30  in Ainos Inc on September 12, 2024 and sell it today you would lose (1.38) from holding Ainos Inc or give up 32.09% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	20.31%
Values	Daily Returns

Acumen Pharmaceuticals  vs.  Ainos Inc

Acumen Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Acumen Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Acumen Pharmaceuticals is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Ainos Inc

Risk-Adjusted Performance

0 of 100

OK

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 unsteady fundamental indicators, Ainos showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Acumen Pharmaceuticals and Ainos

The main advantage of trading using opposite Acumen Pharmaceuticals and Ainos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acumen Pharmaceuticals 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 Acumen Pharmaceuticals 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.