Correlation Between Aqua Public and Amarin Printing

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

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

Diversification Opportunities for Aqua Public and Amarin Printing

0.06

Correlation Coefficient

Aqua Public  Amarin Printing

Significant diversification

The 3 months correlation between Aqua and Amarin is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Aqua Public and Amarin Printing and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amarin Printing and Aqua Public 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 Aqua Public are associated (or correlated) with Amarin Printing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amarin Printing has no effect on the direction of Aqua Public i.e., Aqua Public and Amarin Printing go up and down completely randomly.

Pair Corralation between Aqua Public and Amarin Printing

Assuming the 90 days trading horizon Aqua Public is expected to generate 1.77 times more return on investment than Amarin Printing. However, Aqua Public is 1.77 times more volatile than Amarin Printing and. It trades about -0.01 of its potential returns per unit of risk. Amarin Printing and is currently generating about -0.12 per unit of risk. If you would invest  34.00  in Aqua Public on September 4, 2024 and sell it today you would lose (1.00) from holding Aqua Public or give up 2.94% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Aqua Public  vs.  Amarin Printing and

Aqua Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aqua Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Aqua Public is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Amarin Printing

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amarin Printing and has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Aqua Public and Amarin Printing

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

The idea behind Aqua Public and Amarin Printing and 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..