Correlation Between Hall Of and Aqua Metals

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

By analyzing existing cross correlation between Hall of Fame and Aqua Metals, you can compare the effects of market volatilities on Hall Of and Aqua Metals 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 Hall Of with a short position of Aqua Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hall Of and Aqua Metals.

Diversification Opportunities for Hall Of and Aqua Metals

0.27

Correlation Coefficient

Hall Of  Aqua Metals

Modest diversification

The 3 months correlation between Hall and Aqua is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Hall of Fame and Aqua Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqua Metals and Hall Of 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 Hall of Fame are associated (or correlated) with Aqua Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqua Metals has no effect on the direction of Hall Of i.e., Hall Of and Aqua Metals go up and down completely randomly.

Pair Corralation between Hall Of and Aqua Metals

Given the investment horizon of 90 days Hall Of is expected to generate 9.95 times less return on investment than Aqua Metals. In addition to that, Hall Of is 1.05 times more volatile than Aqua Metals. It trades about 0.0 of its total potential returns per unit of risk. Aqua Metals is currently generating about 0.02 per unit of volatility. If you would invest  211.00  in Aqua Metals on December 26, 2024 and sell it today you would lose (7.00) from holding Aqua Metals or give up 3.32% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Hall of Fame  vs.  Aqua Metals

Hall of Fame

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hall of Fame has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, Hall Of is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Aqua Metals

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Aqua Metals are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak primary indicators, Aqua Metals may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Hall Of and Aqua Metals

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

The idea behind Hall of Fame and Aqua Metals 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.