Correlation Between Aptamer Group and Empire Metals

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

By analyzing existing cross correlation between Aptamer Group PLC and Empire Metals Limited, you can compare the effects of market volatilities on Aptamer Group and Empire Metals 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 Aptamer Group with a short position of Empire Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aptamer Group and Empire Metals.

Diversification Opportunities for Aptamer Group and Empire Metals

-0.21

Correlation Coefficient

Aptamer Group  Empire Metals

Very good diversification

The 3 months correlation between Aptamer and Empire is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Aptamer Group PLC and Empire Metals Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Empire Metals Limited and Aptamer 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 Aptamer Group PLC are associated (or correlated) with Empire Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Empire Metals Limited has no effect on the direction of Aptamer Group i.e., Aptamer Group and Empire Metals go up and down completely randomly.

Pair Corralation between Aptamer Group and Empire Metals

Assuming the 90 days trading horizon Aptamer Group PLC is expected to under-perform the Empire Metals. In addition to that, Aptamer Group is 1.04 times more volatile than Empire Metals Limited. It trades about -0.07 of its total potential returns per unit of risk. Empire Metals Limited is currently generating about 0.24 per unit of volatility. If you would invest  655.00  in Empire Metals Limited on December 24, 2024 and sell it today you would earn a total of  475.00  from holding Empire Metals Limited or generate 72.52% return on investment over 90 days.

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

Aptamer Group PLC  vs.  Empire Metals Limited

Aptamer Group PLC

Risk-Adjusted Performance

Very Weak

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

Empire Metals Limited

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Empire Metals Limited are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Empire Metals exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aptamer Group and Empire Metals

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

The idea behind Aptamer Group PLC and Empire Metals Limited 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.