Correlation Between Aquagold International and Strats Trust

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

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

Diversification Opportunities for Aquagold International and Strats Trust

0.17

Correlation Coefficient

Aquagold International  Strats Trust

Average diversification

The 3 months correlation between Aquagold and Strats is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Strats Trust Cellular in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strats Trust Cellular 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 Strats Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strats Trust Cellular has no effect on the direction of Aquagold International i.e., Aquagold International and Strats Trust go up and down completely randomly.

Pair Corralation between Aquagold International and Strats Trust

Given the investment horizon of 90 days Aquagold International is expected to under-perform the Strats Trust. In addition to that, Aquagold International is 30.98 times more volatile than Strats Trust Cellular. It trades about -0.22 of its total potential returns per unit of risk. Strats Trust Cellular is currently generating about -0.22 per unit of volatility. If you would invest  969.00  in Strats Trust Cellular on October 20, 2024 and sell it today you would lose (29.00) from holding Strats Trust Cellular or give up 2.99% of portfolio value over 90 days.

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

Aquagold International  vs.  Strats Trust Cellular

Aquagold International

Risk-Adjusted Performance

0 of 100

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 February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Strats Trust Cellular

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Strats Trust Cellular has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward-looking indicators, Strats Trust is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Aquagold International and Strats Trust

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

The idea behind Aquagold International and Strats Trust Cellular 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.