Correlation Between Anterix and Socket Mobile

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

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

Diversification Opportunities for Anterix and Socket Mobile

-0.38

Correlation Coefficient

Anterix  Socket Mobile

Very good diversification

The 3 months correlation between Anterix and Socket is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Anterix and Socket Mobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Socket Mobile and Anterix 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 Anterix are associated (or correlated) with Socket Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Socket Mobile has no effect on the direction of Anterix i.e., Anterix and Socket Mobile go up and down completely randomly.

Pair Corralation between Anterix and Socket Mobile

Given the investment horizon of 90 days Anterix is expected to generate 0.81 times more return on investment than Socket Mobile. However, Anterix is 1.23 times less risky than Socket Mobile. It trades about 0.02 of its potential returns per unit of risk. Socket Mobile is currently generating about 0.0 per unit of risk. If you would invest  3,221  in Anterix on September 5, 2024 and sell it today you would earn a total of  177.00  from holding Anterix or generate 5.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Anterix  vs.  Socket Mobile

Anterix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Anterix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical and fundamental indicators, Anterix is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Socket Mobile

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Socket Mobile are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak forward-looking signals, Socket Mobile unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Anterix and Socket Mobile

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

The idea behind Anterix and Socket Mobile 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.