Correlation Between Avante Logixx and Ember Therapeutics

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

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

Diversification Opportunities for Avante Logixx and Ember Therapeutics

0.0

Correlation Coefficient

Avante Logixx  Ember Therapeutics

Pay attention - limited upside

The 3 months correlation between Avante and Ember is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Avante Logixx and Ember Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ember Therapeutics and Avante Logixx 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 Avante Logixx are associated (or correlated) with Ember Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ember Therapeutics has no effect on the direction of Avante Logixx i.e., Avante Logixx and Ember Therapeutics go up and down completely randomly.

Pair Corralation between Avante Logixx and Ember Therapeutics

If you would invest  57.00  in Avante Logixx on February 2, 2024 and sell it today you would earn a total of  8.00  from holding Avante Logixx or generate 14.04% return on investment over 90 days.

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

Avante Logixx  vs.  Ember Therapeutics

Avante Logixx

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Avante Logixx are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Avante Logixx reported solid returns over the last few months and may actually be approaching a breakup point.

Ember Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ember Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental drivers, Ember Therapeutics is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Avante Logixx and Ember Therapeutics

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

The idea behind Avante Logixx and Ember Therapeutics 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.