Correlation Between Amoeba SA and VOGO SA

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

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

Diversification Opportunities for Amoeba SA and VOGO SA

-0.13

Correlation Coefficient

Amoeba SA  VOGO SA

Good diversification

The 3 months correlation between Amoeba and VOGO is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Amoeba SA and VOGO SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VOGO SA and Amoeba SA 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 Amoeba SA are associated (or correlated) with VOGO SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VOGO SA has no effect on the direction of Amoeba SA i.e., Amoeba SA and VOGO SA go up and down completely randomly.

Pair Corralation between Amoeba SA and VOGO SA

Assuming the 90 days trading horizon Amoeba SA is expected to generate 1.64 times more return on investment than VOGO SA. However, Amoeba SA is 1.64 times more volatile than VOGO SA. It trades about 0.17 of its potential returns per unit of risk. VOGO SA is currently generating about -0.03 per unit of risk. If you would invest  42.00  in Amoeba SA on September 30, 2024 and sell it today you would earn a total of  46.00  from holding Amoeba SA or generate 109.52% return on investment over 90 days.

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

Amoeba SA  vs.  VOGO SA

Amoeba SA

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amoeba SA are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Amoeba SA reported solid returns over the last few months and may actually be approaching a breakup point.

VOGO SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VOGO SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Amoeba SA and VOGO SA

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

The idea behind Amoeba SA and VOGO SA 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.