Correlation Between Aspira Womens and Prenetics Global

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

By analyzing existing cross correlation between Aspira Womens Health and Prenetics Global, you can compare the effects of market volatilities on Aspira Womens and Prenetics 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 Aspira Womens with a short position of Prenetics Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspira Womens and Prenetics Global.

Diversification Opportunities for Aspira Womens and Prenetics Global

0.09

Correlation Coefficient

Aspira Womens  Prenetics Global

Significant diversification

The 3 months correlation between Aspira and Prenetics is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Aspira Womens Health and Prenetics Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prenetics Global and Aspira Womens 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 Aspira Womens Health are associated (or correlated) with Prenetics Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prenetics Global has no effect on the direction of Aspira Womens i.e., Aspira Womens and Prenetics Global go up and down completely randomly.

Pair Corralation between Aspira Womens and Prenetics Global

Considering the 90-day investment horizon Aspira Womens Health is expected to under-perform the Prenetics Global. But the stock apears to be less risky and, when comparing its historical volatility, Aspira Womens Health is 1.06 times less risky than Prenetics Global. The stock trades about -0.02 of its potential returns per unit of risk. The Prenetics Global is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  448.00  in Prenetics Global on September 12, 2024 and sell it today you would earn a total of  73.00  from holding Prenetics Global or generate 16.29% return on investment over 90 days.

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

Aspira Womens Health  vs.  Prenetics Global

Aspira Womens Health

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aspira Womens Health has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest abnormal performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Prenetics Global

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Prenetics Global are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Prenetics Global exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aspira Womens and Prenetics Global

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

The idea behind Aspira Womens Health and Prenetics 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.