Correlation Between A10 Networks and Arbe Robotics

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Can any of the company-specific risk be diversified away by investing in both A10 Networks and Arbe Robotics 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 A10 Networks and Arbe Robotics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between A10 Networks and Arbe Robotics, you can compare the effects of market volatilities on A10 Networks and Arbe Robotics 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 A10 Networks with a short position of Arbe Robotics. Check out your portfolio center. Please also check ongoing floating volatility patterns of A10 Networks and Arbe Robotics.

Diversification Opportunities for A10 Networks and Arbe Robotics

-0.22
  Correlation Coefficient

Very good diversification

The 3 months correlation between A10 Networks and Arbe Robotics is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding A10 Networks and Arbe Robotics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arbe Robotics and A10 Networks 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 A10 Networks are associated (or correlated) with Arbe Robotics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arbe Robotics has no effect on the direction of A10 Networks i.e., A10 Networks and Arbe Robotics go up and down completely randomly.

Pair Corralation between A10 Networks and Arbe Robotics

Given the investment horizon of 90 days A10 Networks is expected to under-perform the Arbe Robotics. But the stock apears to be less risky and, when comparing its historical volatility, A10 Networks is 1.2 times less risky than Arbe Robotics. The stock trades about -0.23 of its potential returns per unit of risk. The Arbe Robotics is currently generating about -0.14 of returns per unit of risk over similar time horizon. If you would invest  622.00  in Arbe Robotics on April 6, 2022 and sell it today you would lose (78.00)  from holding Arbe Robotics or give up 12.54% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

A10 Networks  vs.  Arbe Robotics

 Performance (%) 
      Timeline 
A10 Networks 
A10 Networks Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in A10 Networks are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain technical and fundamental indicators, A10 Networks may actually be approaching a critical reversion point that can send shares even higher in August 2022.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0148
Payout Ratio
0.24
Forward Annual Dividend Rate
0.2
Dividend Date
2022-06-01
Ex Dividend Date
2022-05-13

A10 Networks Price Channel

Arbe Robotics 
Arbe Robotics Performance
0 of 100
Over the last 90 days Arbe Robotics 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 fundamental drivers remain rather sound which may send shares a bit higher in August 2022. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Arbe Robotics Price Channel

A10 Networks and Arbe Robotics Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with A10 Networks and Arbe Robotics

The main advantage of trading using opposite A10 Networks and Arbe Robotics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if A10 Networks position performs unexpectedly, Arbe Robotics 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 Arbe Robotics will offset losses from the drop in Arbe Robotics' long position.
The idea behind A10 Networks and Arbe Robotics 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.
Check out your portfolio center. 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 Transaction History module to view history of all your transactions and understand their impact on performance.

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