Correlation Between Aquagold International and Phonex

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

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

Diversification Opportunities for Aquagold International and Phonex

-0.8

Correlation Coefficient

Aquagold International  Phonex

Pay attention - limited upside

The 3 months correlation between Aquagold and Phonex is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Phonex Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phonex Inc 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 Phonex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phonex Inc has no effect on the direction of Aquagold International i.e., Aquagold International and Phonex go up and down completely randomly.

Pair Corralation between Aquagold International and Phonex

Given the investment horizon of 90 days Aquagold International is expected to under-perform the Phonex. But the pink sheet apears to be less risky and, when comparing its historical volatility, Aquagold International is 1.34 times less risky than Phonex. The pink sheet trades about -0.12 of its potential returns per unit of risk. The Phonex Inc is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  109.00  in Phonex Inc on December 29, 2024 and sell it today you would earn a total of  27.00  from holding Phonex Inc or generate 24.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	95.31%
Values	Daily Returns

Aquagold International  vs.  Phonex Inc

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.

Phonex Inc

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Phonex Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical indicators, Phonex demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aquagold International and Phonex

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

The idea behind Aquagold International and Phonex Inc 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.