Correlation Between Api Group and Concrete Pumping

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

By analyzing existing cross correlation between Api Group Corp and Concrete Pumping Holdings, you can compare the effects of market volatilities on Api Group and Concrete Pumping 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 Api Group with a short position of Concrete Pumping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Api Group and Concrete Pumping.

Diversification Opportunities for Api Group and Concrete Pumping

0.4

Correlation Coefficient

Api Group  Concrete Pumping

Very weak diversification

The 3 months correlation between Api and Concrete is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Api Group Corp and Concrete Pumping Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concrete Pumping Holdings and Api Group 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 Api Group Corp are associated (or correlated) with Concrete Pumping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concrete Pumping Holdings has no effect on the direction of Api Group i.e., Api Group and Concrete Pumping go up and down completely randomly.

Pair Corralation between Api Group and Concrete Pumping

Considering the 90-day investment horizon Api Group Corp is expected to generate 0.45 times more return on investment than Concrete Pumping. However, Api Group Corp is 2.21 times less risky than Concrete Pumping. It trades about 0.03 of its potential returns per unit of risk. Concrete Pumping Holdings is currently generating about -0.01 per unit of risk. If you would invest  3,602  in Api Group Corp on December 28, 2024 and sell it today you would earn a total of  68.00  from holding Api Group Corp or generate 1.89% return on investment over 90 days.

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

Api Group Corp  vs.  Concrete Pumping Holdings

Api Group Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Api Group Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Api Group is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Concrete Pumping Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Concrete Pumping Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental indicators, Concrete Pumping is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Api Group and Concrete Pumping

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

The idea behind Api Group Corp and Concrete Pumping Holdings 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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.