Correlation Between Argo Blockchain and Vortex Brands

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

By analyzing existing cross correlation between Argo Blockchain PLC and Vortex Brands Co, you can compare the effects of market volatilities on Argo Blockchain and Vortex Brands 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 Argo Blockchain with a short position of Vortex Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argo Blockchain and Vortex Brands.

Diversification Opportunities for Argo Blockchain and Vortex Brands

0.71

Correlation Coefficient

Argo Blockchain  Vortex Brands

Poor diversification

The 3 months correlation between Argo and Vortex is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Argo Blockchain PLC and Vortex Brands Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vortex Brands and Argo Blockchain 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 Argo Blockchain PLC are associated (or correlated) with Vortex Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vortex Brands has no effect on the direction of Argo Blockchain i.e., Argo Blockchain and Vortex Brands go up and down completely randomly.

Pair Corralation between Argo Blockchain and Vortex Brands

Assuming the 90 days horizon Argo Blockchain PLC is expected to under-perform the Vortex Brands. But the pink sheet apears to be less risky and, when comparing its historical volatility, Argo Blockchain PLC is 1.93 times less risky than Vortex Brands. The pink sheet trades about -0.03 of its potential returns per unit of risk. The Vortex Brands Co is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  0.04  in Vortex Brands Co on October 22, 2024 and sell it today you would lose (0.02) from holding Vortex Brands Co or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.2%
Values	Daily Returns

Argo Blockchain PLC  vs.  Vortex Brands Co

Argo Blockchain PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Argo Blockchain PLC 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 forward-looking signals remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Vortex Brands

Risk-Adjusted Performance

3 of 100

Insignificant

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

Pair Trading with Argo Blockchain and Vortex Brands

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

The idea behind Argo Blockchain PLC and Vortex Brands Co 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.