Correlation Between Actelis Networks and Akoustis Technologies

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

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

Diversification Opportunities for Actelis Networks and Akoustis Technologies

-0.11

Correlation Coefficient

Actelis Networks  Akoustis Technologies

Good diversification

The 3 months correlation between Actelis and Akoustis is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Actelis Networks and Akoustis Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akoustis Technologies and Actelis Networks 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 Actelis Networks are associated (or correlated) with Akoustis Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akoustis Technologies has no effect on the direction of Actelis Networks i.e., Actelis Networks and Akoustis Technologies go up and down completely randomly.

Pair Corralation between Actelis Networks and Akoustis Technologies

Given the investment horizon of 90 days Actelis Networks is expected to under-perform the Akoustis Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Actelis Networks is 2.38 times less risky than Akoustis Technologies. The stock trades about -0.07 of its potential returns per unit of risk. The Akoustis Technologies is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  8.45  in Akoustis Technologies on August 31, 2024 and sell it today you would earn a total of  2.55  from holding Akoustis Technologies or generate 30.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Actelis Networks  vs.  Akoustis Technologies

Actelis Networks

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Actelis Networks has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Akoustis Technologies

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Akoustis Technologies are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Akoustis Technologies unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Actelis Networks and Akoustis Technologies

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

The idea behind Actelis Networks and Akoustis Technologies 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..