Correlation Between Aquagold International and Fortress Transportation

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

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

Diversification Opportunities for Aquagold International and Fortress Transportation

0.43

Correlation Coefficient

Aquagold International  Fortress Transportation

Very weak diversification

The 3 months correlation between Aquagold and Fortress is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Fortress Transportation And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortress Transportation 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 Fortress Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortress Transportation has no effect on the direction of Aquagold International i.e., Aquagold International and Fortress Transportation go up and down completely randomly.

Pair Corralation between Aquagold International and Fortress Transportation

Given the investment horizon of 90 days Aquagold International is expected to under-perform the Fortress Transportation. In addition to that, Aquagold International is 27.0 times more volatile than Fortress Transportation And. It trades about -0.12 of its total potential returns per unit of risk. Fortress Transportation And is currently generating about 0.14 per unit of volatility. If you would invest  2,520  in Fortress Transportation And on December 30, 2024 and sell it today you would earn a total of  26.00  from holding Fortress Transportation And or generate 1.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	50.77%
Values	Daily Returns

Aquagold International  vs.  Fortress Transportation And

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.

Fortress Transportation

Risk-Adjusted Performance

OK

Over the last 90 days Fortress Transportation And has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, Fortress Transportation is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Aquagold International and Fortress Transportation

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

The idea behind Aquagold International and Fortress Transportation 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.

Check out your portfolio center.

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..