Correlation Between Acm Research and Securitas

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

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

Diversification Opportunities for Acm Research and Securitas

-0.75

Correlation Coefficient

Acm Research  Securitas

Pay attention - limited upside

The 3 months correlation between Acm and Securitas is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Acm Research and Securitas AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Securitas AB and Acm Research 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 Acm Research are associated (or correlated) with Securitas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Securitas AB has no effect on the direction of Acm Research i.e., Acm Research and Securitas go up and down completely randomly.

Pair Corralation between Acm Research and Securitas

Given the investment horizon of 90 days Acm Research is expected to under-perform the Securitas. In addition to that, Acm Research is 2.15 times more volatile than Securitas AB. It trades about -0.06 of its total potential returns per unit of risk. Securitas AB is currently generating about 0.16 per unit of volatility. If you would invest  1,140  in Securitas AB on September 26, 2024 and sell it today you would earn a total of  145.00  from holding Securitas AB or generate 12.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	58.73%
Values	Daily Returns

Acm Research  vs.  Securitas AB

Acm Research

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Acm Research has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's primary indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Securitas AB

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Securitas AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly abnormal fundamental drivers, Securitas reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Acm Research and Securitas

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

The idea behind Acm Research and Securitas AB 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 the Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.