Correlation Between American Rebel and Alvotech Warrant

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

By analyzing existing cross correlation between American Rebel Holdings and Alvotech Warrant, you can compare the effects of market volatilities on American Rebel and Alvotech Warrant 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 American Rebel with a short position of Alvotech Warrant. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Rebel and Alvotech Warrant.

Diversification Opportunities for American Rebel and Alvotech Warrant

-0.51

Correlation Coefficient

American Rebel  Alvotech Warrant

Excellent diversification

The 3 months correlation between American and Alvotech is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding American Rebel Holdings and Alvotech Warrant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alvotech Warrant and American Rebel 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 American Rebel Holdings are associated (or correlated) with Alvotech Warrant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alvotech Warrant has no effect on the direction of American Rebel i.e., American Rebel and Alvotech Warrant go up and down completely randomly.

Pair Corralation between American Rebel and Alvotech Warrant

Assuming the 90 days horizon American Rebel Holdings is expected to generate 3.26 times more return on investment than Alvotech Warrant. However, American Rebel is 3.26 times more volatile than Alvotech Warrant. It trades about 0.13 of its potential returns per unit of risk. Alvotech Warrant is currently generating about -0.04 per unit of risk. If you would invest  1.06  in American Rebel Holdings on December 30, 2024 and sell it today you would earn a total of  0.05  from holding American Rebel Holdings or generate 4.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	80.33%
Values	Daily Returns

American Rebel Holdings  vs.  Alvotech Warrant

American Rebel Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in American Rebel Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain fundamental drivers, American Rebel showed solid returns over the last few months and may actually be approaching a breakup point.

Alvotech Warrant

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alvotech Warrant has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with American Rebel and Alvotech Warrant

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

The idea behind American Rebel Holdings and Alvotech Warrant 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .