Correlation Between Swvl Holdings and Aware

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

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

Diversification Opportunities for Swvl Holdings and Aware

-0.08

Correlation Coefficient

Swvl Holdings  Aware

Good diversification

The 3 months correlation between Swvl and Aware is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Swvl Holdings Corp and Aware Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aware Inc and Swvl 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 Swvl Holdings Corp are associated (or correlated) with Aware. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aware Inc has no effect on the direction of Swvl Holdings i.e., Swvl Holdings and Aware go up and down completely randomly.

Pair Corralation between Swvl Holdings and Aware

Assuming the 90 days horizon Swvl Holdings Corp is expected to under-perform the Aware. In addition to that, Swvl Holdings is 1.06 times more volatile than Aware Inc. It trades about -0.42 of its total potential returns per unit of risk. Aware Inc is currently generating about 0.03 per unit of volatility. If you would invest  150.00  in Aware Inc on September 15, 2024 and sell it today you would earn a total of  2.00  from holding Aware Inc or generate 1.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	85.71%
Values	Daily Returns

Swvl Holdings Corp  vs.  Aware Inc

Swvl Holdings Corp

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Swvl Holdings Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal essential indicators, Swvl Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

Aware Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aware Inc 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 rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Swvl Holdings and Aware

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

The idea behind Swvl Holdings Corp and Aware Inc 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.