Correlation Between Coupang LLC and ALVGR

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

By analyzing existing cross correlation between Coupang LLC and ALVGR 35, you can compare the effects of market volatilities on Coupang LLC and ALVGR 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 Coupang LLC with a short position of ALVGR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coupang LLC and ALVGR.

Diversification Opportunities for Coupang LLC and ALVGR

0.47

Correlation Coefficient

Coupang LLC  ALVGR

Very weak diversification

The 3 months correlation between Coupang and ALVGR is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Coupang LLC and ALVGR 35 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALVGR 35 and Coupang LLC 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 Coupang LLC are associated (or correlated) with ALVGR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALVGR 35 has no effect on the direction of Coupang LLC i.e., Coupang LLC and ALVGR go up and down completely randomly.

Pair Corralation between Coupang LLC and ALVGR

Given the investment horizon of 90 days Coupang LLC is expected to generate 0.93 times more return on investment than ALVGR. However, Coupang LLC is 1.08 times less risky than ALVGR. It trades about 0.02 of its potential returns per unit of risk. ALVGR 35 is currently generating about -0.18 per unit of risk. If you would invest  2,370  in Coupang LLC on September 12, 2024 and sell it today you would earn a total of  19.00  from holding Coupang LLC or generate 0.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	42.19%
Values	Daily Returns

Coupang LLC  vs.  ALVGR 35

Coupang LLC

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Coupang LLC are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Coupang LLC is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

ALVGR 35

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ALVGR 35 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for ALVGR 35 investors.

Pair Trading with Coupang LLC and ALVGR

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

The idea behind Coupang LLC and ALVGR 35 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.