Correlation Between Phoslock Environmental and Maggie Beer

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

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

Diversification Opportunities for Phoslock Environmental and Maggie Beer

0.0

Correlation Coefficient

Phoslock Environmental  Maggie Beer

Pay attention - limited upside

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

Pair Corralation between Phoslock Environmental and Maggie Beer

Assuming the 90 days trading horizon Phoslock Environmental Technologies is expected to generate 0.99 times more return on investment than Maggie Beer. However, Phoslock Environmental Technologies is 1.01 times less risky than Maggie Beer. It trades about 0.0 of its potential returns per unit of risk. Maggie Beer Holdings is currently generating about -0.03 per unit of risk. If you would invest  3.90  in Phoslock Environmental Technologies on October 10, 2024 and sell it today you would lose (1.40) from holding Phoslock Environmental Technologies or give up 35.9% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Phoslock Environmental Technol  vs.  Maggie Beer Holdings

Phoslock Environmental

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Phoslock Environmental Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Phoslock Environmental is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Maggie Beer Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Maggie Beer Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Phoslock Environmental and Maggie Beer

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

The idea behind Phoslock Environmental Technologies and Maggie Beer Holdings 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.