Correlation Between A Cap and Almonty Industries

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

By analyzing existing cross correlation between A Cap Energy Limited and Almonty Industries, you can compare the effects of market volatilities on A Cap and Almonty Industries 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 A Cap with a short position of Almonty Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of A Cap and Almonty Industries.

Diversification Opportunities for A Cap and Almonty Industries

0.2

Correlation Coefficient

A Cap  Almonty Industries

Modest diversification

The 3 months correlation between APCDF and Almonty is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding A Cap Energy Limited and Almonty Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almonty Industries and A Cap 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 A Cap Energy Limited are associated (or correlated) with Almonty Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almonty Industries has no effect on the direction of A Cap i.e., A Cap and Almonty Industries go up and down completely randomly.

Pair Corralation between A Cap and Almonty Industries

If you would invest  63.00  in Almonty Industries on October 11, 2024 and sell it today you would earn a total of  8.00  from holding Almonty Industries or generate 12.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	4.76%
Values	Daily Returns

A Cap Energy Limited  vs.  Almonty Industries

A Cap Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days A Cap Energy Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, A Cap is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Almonty Industries

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Almonty Industries are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Almonty Industries reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with A Cap and Almonty Industries

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

The idea behind A Cap Energy Limited and Almonty Industries 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.