Correlation Between Alchemy Pay and Aptos

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

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

Diversification Opportunities for Alchemy Pay and Aptos

-0.15

Correlation Coefficient

Alchemy Pay  Aptos

Good diversification

The 3 months correlation between Alchemy and Aptos is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Alchemy Pay and Aptos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptos and Alchemy Pay 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 Alchemy Pay are associated (or correlated) with Aptos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptos has no effect on the direction of Alchemy Pay i.e., Alchemy Pay and Aptos go up and down completely randomly.

Pair Corralation between Alchemy Pay and Aptos

Assuming the 90 days trading horizon Alchemy Pay is expected to generate 2.17 times more return on investment than Aptos. However, Alchemy Pay is 2.17 times more volatile than Aptos. It trades about 0.03 of its potential returns per unit of risk. Aptos is currently generating about -0.12 per unit of risk. If you would invest  2.55  in Alchemy Pay on December 30, 2024 and sell it today you would lose (0.38) from holding Alchemy Pay or give up 14.9% of portfolio value over 90 days.

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

Alchemy Pay  vs.  Aptos

Alchemy Pay

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Alchemy Pay are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical indicators, Alchemy Pay exhibited solid returns over the last few months and may actually be approaching a breakup point.

Aptos

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aptos has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for Aptos shareholders.

Pair Trading with Alchemy Pay and Aptos

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

The idea behind Alchemy Pay and Aptos 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.