Correlation Between Alfa Financial and Tissue Regenix

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

By analyzing existing cross correlation between Alfa Financial Software and Tissue Regenix Group, you can compare the effects of market volatilities on Alfa Financial and Tissue Regenix 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 Alfa Financial with a short position of Tissue Regenix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alfa Financial and Tissue Regenix.

Diversification Opportunities for Alfa Financial and Tissue Regenix

0.19

Correlation Coefficient

Alfa Financial  Tissue Regenix

Average diversification

The 3 months correlation between Alfa and Tissue is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Alfa Financial Software and Tissue Regenix Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tissue Regenix Group and Alfa Financial 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 Alfa Financial Software are associated (or correlated) with Tissue Regenix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tissue Regenix Group has no effect on the direction of Alfa Financial i.e., Alfa Financial and Tissue Regenix go up and down completely randomly.

Pair Corralation between Alfa Financial and Tissue Regenix

Assuming the 90 days trading horizon Alfa Financial Software is expected to under-perform the Tissue Regenix. In addition to that, Alfa Financial is 1.2 times more volatile than Tissue Regenix Group. It trades about -0.05 of its total potential returns per unit of risk. Tissue Regenix Group is currently generating about 0.1 per unit of volatility. If you would invest  5,400  in Tissue Regenix Group on October 25, 2024 and sell it today you would earn a total of  500.00  from holding Tissue Regenix Group or generate 9.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Alfa Financial Software  vs.  Tissue Regenix Group

Alfa Financial Software

Risk-Adjusted Performance

0 of 100

Very Weak

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

Tissue Regenix Group

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Tissue Regenix Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Tissue Regenix may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Alfa Financial and Tissue Regenix

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

The idea behind Alfa Financial Software and Tissue Regenix Group 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.