Correlation Between Blue Diamond and AimRite Holdings

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

By analyzing existing cross correlation between Blue Diamond Ventures and AimRite Holdings Corp, you can compare the effects of market volatilities on Blue Diamond and AimRite Holdings 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 Blue Diamond with a short position of AimRite Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Diamond and AimRite Holdings.

Diversification Opportunities for Blue Diamond and AimRite Holdings

0.0

Correlation Coefficient

Blue Diamond  AimRite Holdings

Pay attention - limited upside

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

Pair Corralation between Blue Diamond and AimRite Holdings

If you would invest  0.02  in Blue Diamond Ventures on December 28, 2024 and sell it today you would lose (0.01) from holding Blue Diamond Ventures or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Blue Diamond Ventures  vs.  AimRite Holdings Corp

Blue Diamond Ventures

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Blue Diamond Ventures are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating fundamental indicators, Blue Diamond showed solid returns over the last few months and may actually be approaching a breakup point.

AimRite Holdings Corp

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Blue Diamond and AimRite Holdings

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

The idea behind Blue Diamond Ventures and AimRite Holdings Corp 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.