Correlation Between Aquagold International and Amaero International

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

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

Diversification Opportunities for Aquagold International and Amaero International

0.02

Correlation Coefficient

Aquagold International  Amaero International

Significant diversification

The 3 months correlation between Aquagold and Amaero is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Amaero International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amaero International and Aquagold International 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 Aquagold International are associated (or correlated) with Amaero International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amaero International has no effect on the direction of Aquagold International i.e., Aquagold International and Amaero International go up and down completely randomly.

Pair Corralation between Aquagold International and Amaero International

Given the investment horizon of 90 days Aquagold International is expected to under-perform the Amaero International. But the pink sheet apears to be less risky and, when comparing its historical volatility, Aquagold International is 1.41 times less risky than Amaero International. The pink sheet trades about -0.13 of its potential returns per unit of risk. The Amaero International is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  18.00  in Amaero International on December 27, 2024 and sell it today you would earn a total of  0.00  from holding Amaero International or generate 0.0% return on investment over 90 days.

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

Aquagold International  vs.  Amaero International

Aquagold International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aquagold International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Amaero International

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Amaero International are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Amaero International reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aquagold International and Amaero International

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

The idea behind Aquagold International and Amaero International 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.