Correlation Between Ageagle Aerial and Nano Dimension

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

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

Diversification Opportunities for Ageagle Aerial and Nano Dimension

-0.13

Correlation Coefficient

Ageagle Aerial  Nano Dimension

Good diversification

The 3 months correlation between Ageagle and Nano is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Ageagle Aerial Systems and Nano Dimension in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nano Dimension and Ageagle Aerial 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 Ageagle Aerial Systems are associated (or correlated) with Nano Dimension. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nano Dimension has no effect on the direction of Ageagle Aerial i.e., Ageagle Aerial and Nano Dimension go up and down completely randomly.

Pair Corralation between Ageagle Aerial and Nano Dimension

Given the investment horizon of 90 days Ageagle Aerial Systems is expected to generate 8.35 times more return on investment than Nano Dimension. However, Ageagle Aerial is 8.35 times more volatile than Nano Dimension. It trades about 0.06 of its potential returns per unit of risk. Nano Dimension is currently generating about 0.08 per unit of risk. If you would invest  1,350  in Ageagle Aerial Systems on September 8, 2024 and sell it today you would lose (765.00) from holding Ageagle Aerial Systems or give up 56.67% of portfolio value over 90 days.

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

Ageagle Aerial Systems  vs.  Nano Dimension

Ageagle Aerial Systems

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ageagle Aerial Systems are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Ageagle Aerial unveiled solid returns over the last few months and may actually be approaching a breakup point.

Nano Dimension

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nano Dimension are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Nano Dimension displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ageagle Aerial and Nano Dimension

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

The idea behind Ageagle Aerial Systems and Nano Dimension 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.