Correlation Between ALM Equity and Ayima Group

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

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

Diversification Opportunities for ALM Equity and Ayima Group

0.0

Correlation Coefficient

ALM Equity  Ayima Group

Pay attention - limited upside

The 3 months correlation between ALM and Ayima is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ALM Equity AB and Ayima Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ayima Group AB and ALM Equity 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 ALM Equity AB are associated (or correlated) with Ayima Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ayima Group AB has no effect on the direction of ALM Equity i.e., ALM Equity and Ayima Group go up and down completely randomly.

Pair Corralation between ALM Equity and Ayima Group

If you would invest  332.00  in Ayima Group AB on September 2, 2024 and sell it today you would earn a total of  0.00  from holding Ayima Group AB or generate 0.0% return on investment over 90 days.

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

ALM Equity AB  vs.  Ayima Group AB

ALM Equity AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ALM Equity AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's primary indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Ayima Group AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ayima Group AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong primary indicators, Ayima Group is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with ALM Equity and Ayima Group

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

The idea behind ALM Equity AB and Ayima Group 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.

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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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.