Correlation Between Remark Holdings and Alarum Technologies

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

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

Diversification Opportunities for Remark Holdings and Alarum Technologies

0.24

Correlation Coefficient

Remark Holdings  Alarum Technologies

Modest diversification

The 3 months correlation between Remark and Alarum is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Remark Holdings and Alarum Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alarum Technologies and Remark Holdings 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 Remark Holdings are associated (or correlated) with Alarum Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alarum Technologies has no effect on the direction of Remark Holdings i.e., Remark Holdings and Alarum Technologies go up and down completely randomly.

Pair Corralation between Remark Holdings and Alarum Technologies

If you would invest  1,308  in Alarum Technologies on September 13, 2024 and sell it today you would lose (141.00) from holding Alarum Technologies or give up 10.78% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.56%
Values	Daily Returns

Remark Holdings  vs.  Alarum Technologies

Remark Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Remark Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Remark Holdings is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

Alarum Technologies

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Alarum Technologies are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Alarum Technologies may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Remark Holdings and Alarum Technologies

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

The idea behind Remark Holdings and Alarum Technologies 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.