Correlation Between LanzaTech Global and Anaergia

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

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

Diversification Opportunities for LanzaTech Global and Anaergia

-0.25

Correlation Coefficient

LanzaTech Global  Anaergia

Very good diversification

The 3 months correlation between LanzaTech and Anaergia is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding LanzaTech Global and Anaergia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anaergia and LanzaTech Global 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 LanzaTech Global are associated (or correlated) with Anaergia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anaergia has no effect on the direction of LanzaTech Global i.e., LanzaTech Global and Anaergia go up and down completely randomly.

Pair Corralation between LanzaTech Global and Anaergia

Assuming the 90 days horizon LanzaTech Global is expected to generate 1.8 times less return on investment than Anaergia. But when comparing it to its historical volatility, LanzaTech Global is 1.21 times less risky than Anaergia. It trades about 0.05 of its potential returns per unit of risk. Anaergia is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  278.00  in Anaergia on September 13, 2024 and sell it today you would lose (215.00) from holding Anaergia or give up 77.34% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	87.45%
Values	Daily Returns

LanzaTech Global  vs.  Anaergia

LanzaTech Global

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LanzaTech Global has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Anaergia

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Anaergia are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Anaergia reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with LanzaTech Global and Anaergia

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

The idea behind LanzaTech Global and Anaergia 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.