Correlation Between Azure Holding and C2E Energy

Can any of the company-specific risk be diversified away by investing in both Azure Holding and C2E Energy 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 Azure Holding and C2E Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Azure Holding Group and C2E Energy, you can compare the effects of market volatilities on Azure Holding and C2E Energy 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 Azure Holding with a short position of C2E Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azure Holding and C2E Energy.

Diversification Opportunities for Azure Holding and C2E Energy

0.0

Correlation Coefficient

Azure Holding  C2E Energy

Pay attention - limited upside

The 3 months correlation between Azure and C2E is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Azure Holding Group and C2E Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on C2E Energy and Azure Holding 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 Azure Holding Group are associated (or correlated) with C2E Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of C2E Energy has no effect on the direction of Azure Holding i.e., Azure Holding and C2E Energy go up and down completely randomly.

Pair Corralation between Azure Holding and C2E Energy

Given the investment horizon of 90 days Azure Holding Group is expected to generate 1.93 times more return on investment than C2E Energy. However, Azure Holding is 1.93 times more volatile than C2E Energy. It trades about 0.09 of its potential returns per unit of risk. C2E Energy is currently generating about 0.05 per unit of risk. If you would invest  0.11  in Azure Holding Group on September 15, 2024 and sell it today you would earn a total of  11.89  from holding Azure Holding Group or generate 10809.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.63%
Values	Daily Returns

Azure Holding Group  vs.  C2E Energy

Azure Holding Group

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Azure Holding Group are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, Azure Holding demonstrated solid returns over the last few months and may actually be approaching a breakup point.

C2E Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days C2E Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, C2E Energy is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Azure Holding and C2E Energy

The main advantage of trading using opposite Azure Holding and C2E Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Azure Holding position performs unexpectedly, C2E Energy 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 C2E Energy will offset losses from the drop in C2E Energy's long position.

The idea behind Azure Holding Group and C2E Energy 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.