Correlation Between Ageas SANV and Lotus Bakeries

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

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

Diversification Opportunities for Ageas SANV and Lotus Bakeries

-0.94

Correlation Coefficient

Ageas SANV  Lotus Bakeries

Pay attention - limited upside

The 3 months correlation between Ageas and Lotus is -0.94. Overlapping area represents the amount of risk that can be diversified away by holding ageas SANV and Lotus Bakeries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotus Bakeries and Ageas SANV 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 ageas SANV are associated (or correlated) with Lotus Bakeries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotus Bakeries has no effect on the direction of Ageas SANV i.e., Ageas SANV and Lotus Bakeries go up and down completely randomly.

Pair Corralation between Ageas SANV and Lotus Bakeries

Assuming the 90 days trading horizon ageas SANV is expected to generate 0.51 times more return on investment than Lotus Bakeries. However, ageas SANV is 1.95 times less risky than Lotus Bakeries. It trades about 0.34 of its potential returns per unit of risk. Lotus Bakeries is currently generating about -0.22 per unit of risk. If you would invest  4,636  in ageas SANV on December 28, 2024 and sell it today you would earn a total of  979.00  from holding ageas SANV or generate 21.12% return on investment over 90 days.

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

ageas SANV  vs.  Lotus Bakeries

ageas SANV

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in ageas SANV are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Ageas SANV reported solid returns over the last few months and may actually be approaching a breakup point.

Lotus Bakeries

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lotus Bakeries 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 basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Ageas SANV and Lotus Bakeries

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

The idea behind ageas SANV and Lotus Bakeries 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.