Correlation Between Antibiotice and Aages SA

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

By analyzing existing cross correlation between Antibiotice Ia and Aages SA, you can compare the effects of market volatilities on Antibiotice and Aages SA 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 Antibiotice with a short position of Aages SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Antibiotice and Aages SA.

Diversification Opportunities for Antibiotice and Aages SA

0.9

Correlation Coefficient

Antibiotice  Aages SA

Almost no diversification

The 3 months correlation between Antibiotice and Aages is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Antibiotice Ia and Aages SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aages SA and Antibiotice 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 Antibiotice Ia are associated (or correlated) with Aages SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aages SA has no effect on the direction of Antibiotice i.e., Antibiotice and Aages SA go up and down completely randomly.

Pair Corralation between Antibiotice and Aages SA

Assuming the 90 days trading horizon Antibiotice Ia is expected to generate 1.33 times more return on investment than Aages SA. However, Antibiotice is 1.33 times more volatile than Aages SA. It trades about 0.14 of its potential returns per unit of risk. Aages SA is currently generating about 0.09 per unit of risk. If you would invest  54.00  in Antibiotice Ia on October 21, 2024 and sell it today you would earn a total of  204.00  from holding Antibiotice Ia or generate 377.78% return on investment over 90 days.

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

Antibiotice Ia  vs.  Aages SA

Antibiotice Ia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Antibiotice Ia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental drivers remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Aages SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aages SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Antibiotice and Aages SA

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

The idea behind Antibiotice Ia and Aages SA 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.