Correlation Between Nano Labs and Axcelis Technologies

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

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

Diversification Opportunities for Nano Labs and Axcelis Technologies

-0.1

Correlation Coefficient

Nano Labs  Axcelis Technologies

Good diversification

The 3 months correlation between Nano and Axcelis is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Nano Labs and Axcelis Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axcelis Technologies and Nano Labs 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 Nano Labs are associated (or correlated) with Axcelis Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axcelis Technologies has no effect on the direction of Nano Labs i.e., Nano Labs and Axcelis Technologies go up and down completely randomly.

Pair Corralation between Nano Labs and Axcelis Technologies

Allowing for the 90-day total investment horizon Nano Labs is expected to generate 4.67 times more return on investment than Axcelis Technologies. However, Nano Labs is 4.67 times more volatile than Axcelis Technologies. It trades about 0.04 of its potential returns per unit of risk. Axcelis Technologies is currently generating about -0.05 per unit of risk. If you would invest  1,350  in Nano Labs on October 1, 2024 and sell it today you would lose (575.00) from holding Nano Labs or give up 42.59% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Nano Labs  vs.  Axcelis Technologies

Nano Labs

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nano Labs are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Nano Labs sustained solid returns over the last few months and may actually be approaching a breakup point.

Axcelis Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Axcelis Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's essential indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Nano Labs and Axcelis Technologies

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

The idea behind Nano Labs and Axcelis 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.