Correlation Between EA Series and Akros Monthly

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

By analyzing existing cross correlation between EA Series Trust and Akros Monthly Payout, you can compare the effects of market volatilities on EA Series and Akros Monthly 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 EA Series with a short position of Akros Monthly. Check out your portfolio center. Please also check ongoing floating volatility patterns of EA Series and Akros Monthly.

Diversification Opportunities for EA Series and Akros Monthly

0.55

Correlation Coefficient

EA Series  Akros Monthly

Very weak diversification

The 3 months correlation between DRAI and Akros is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding EA Series Trust and Akros Monthly Payout in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akros Monthly Payout and EA Series 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 EA Series Trust are associated (or correlated) with Akros Monthly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akros Monthly Payout has no effect on the direction of EA Series i.e., EA Series and Akros Monthly go up and down completely randomly.

Pair Corralation between EA Series and Akros Monthly

Given the investment horizon of 90 days EA Series Trust is expected to generate 0.07 times more return on investment than Akros Monthly. However, EA Series Trust is 14.49 times less risky than Akros Monthly. It trades about -0.03 of its potential returns per unit of risk. Akros Monthly Payout is currently generating about -0.21 per unit of risk. If you would invest  2,401  in EA Series Trust on September 28, 2024 and sell it today you would lose (27.00) from holding EA Series Trust or give up 1.12% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.24%
Values	Daily Returns

EA Series Trust  vs.  Akros Monthly Payout

EA Series Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EA Series Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, EA Series is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Akros Monthly Payout

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Akros Monthly Payout are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Akros Monthly is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with EA Series and Akros Monthly

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

The idea behind EA Series Trust and Akros Monthly Payout 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.