Correlation Between Safe and Almonty Industries

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

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

Diversification Opportunities for Safe and Almonty Industries

-0.6

Correlation Coefficient

Safe  Almonty Industries

Excellent diversification

The 3 months correlation between Safe and Almonty is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Safe and Green and Almonty Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almonty Industries and Safe 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 Safe and Green are associated (or correlated) with Almonty Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almonty Industries has no effect on the direction of Safe i.e., Safe and Almonty Industries go up and down completely randomly.

Pair Corralation between Safe and Almonty Industries

Considering the 90-day investment horizon Safe and Green is expected to under-perform the Almonty Industries. But the stock apears to be less risky and, when comparing its historical volatility, Safe and Green is 1.2 times less risky than Almonty Industries. The stock trades about -0.13 of its potential returns per unit of risk. The Almonty Industries is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  63.00  in Almonty Industries on December 28, 2024 and sell it today you would earn a total of  91.00  from holding Almonty Industries or generate 144.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Safe and Green  vs.  Almonty Industries

Safe and Green

Risk-Adjusted Performance

Very Weak

Over the last 90 days Safe and Green has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Almonty Industries

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Almonty Industries are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Almonty Industries reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Safe and Almonty Industries

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

The idea behind Safe and Green and Almonty Industries 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..