Correlation Between Azul SA and SEALSQ Corp

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

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

Diversification Opportunities for Azul SA and SEALSQ Corp

0.0

Correlation Coefficient

Azul SA  SEALSQ Corp

Pay attention - limited upside

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

Pair Corralation between Azul SA and SEALSQ Corp

Given the investment horizon of 90 days Azul SA is expected to under-perform the SEALSQ Corp. But the stock apears to be less risky and, when comparing its historical volatility, Azul SA is 85.54 times less risky than SEALSQ Corp. The stock trades about -0.02 of its potential returns per unit of risk. The SEALSQ Corp Ordinary is currently generating about 0.49 of returns per unit of risk over similar time horizon. If you would invest  0.00  in SEALSQ Corp Ordinary on September 21, 2024 and sell it today you would earn a total of  2,197  from holding SEALSQ Corp Ordinary or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.01%
Values	Daily Returns

Azul SA  vs.  SEALSQ Corp Ordinary

Azul SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Azul SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

SEALSQ Corp Ordinary

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SEALSQ Corp Ordinary has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, SEALSQ Corp is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Azul SA and SEALSQ Corp

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

The idea behind Azul SA and SEALSQ Corp Ordinary 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..