Correlation Between Aquagold International and Mccoy Global

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

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

Diversification Opportunities for Aquagold International and Mccoy Global

0.27

Correlation Coefficient

Aquagold International  Mccoy Global

Modest diversification

The 3 months correlation between Aquagold and Mccoy is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Mccoy Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mccoy Global 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 Mccoy Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mccoy Global has no effect on the direction of Aquagold International i.e., Aquagold International and Mccoy Global go up and down completely randomly.

Pair Corralation between Aquagold International and Mccoy Global

Given the investment horizon of 90 days Aquagold International is expected to under-perform the Mccoy Global. In addition to that, Aquagold International is 13.02 times more volatile than Mccoy Global. It trades about -0.22 of its total potential returns per unit of risk. Mccoy Global is currently generating about -0.05 per unit of volatility. If you would invest  203.00  in Mccoy Global on October 6, 2024 and sell it today you would lose (4.00) from holding Mccoy Global or give up 1.97% of portfolio value over 90 days.

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

Aquagold International  vs.  Mccoy Global

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.

Mccoy Global

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mccoy Global has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Mccoy Global is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Aquagold International and Mccoy Global

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

The idea behind Aquagold International and Mccoy Global 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.