Correlation Between Azimut Exploration and A Cap

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

By analyzing existing cross correlation between Azimut Exploration and A Cap Energy Limited, you can compare the effects of market volatilities on Azimut Exploration and A Cap 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 Azimut Exploration with a short position of A Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azimut Exploration and A Cap.

Diversification Opportunities for Azimut Exploration and A Cap

0.0

Correlation Coefficient

Azimut Exploration  A Cap

Pay attention - limited upside

The 3 months correlation between Azimut and APCDF is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Azimut Exploration and A Cap Energy Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A Cap Energy and Azimut Exploration 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 Azimut Exploration are associated (or correlated) with A Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A Cap Energy has no effect on the direction of Azimut Exploration i.e., Azimut Exploration and A Cap go up and down completely randomly.

Pair Corralation between Azimut Exploration and A Cap

If you would invest (100.00) in A Cap Energy Limited on December 29, 2024 and sell it today you would earn a total of  100.00  from holding A Cap Energy Limited or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Azimut Exploration  vs.  A Cap Energy Limited

Azimut Exploration

Risk-Adjusted Performance

Very Weak

Over the last 90 days Azimut Exploration has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

A Cap Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days A Cap Energy Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, A Cap is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Azimut Exploration and A Cap

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

The idea behind Azimut Exploration and A Cap Energy Limited 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.

Check out your portfolio center.

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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.