Correlation Between Atlantic Sapphire and AquaBounty Technologies
Can any of the company-specific risk be diversified away by investing in both Atlantic Sapphire and AquaBounty 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 Atlantic Sapphire and AquaBounty Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlantic Sapphire ASA and AquaBounty Technologies, you can compare the effects of market volatilities on Atlantic Sapphire and AquaBounty 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 Atlantic Sapphire with a short position of AquaBounty Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlantic Sapphire and AquaBounty Technologies.
Diversification Opportunities for Atlantic Sapphire and AquaBounty Technologies
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Atlantic and AquaBounty is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Atlantic Sapphire ASA and AquaBounty Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AquaBounty Technologies and Atlantic Sapphire 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 Atlantic Sapphire ASA are associated (or correlated) with AquaBounty Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AquaBounty Technologies has no effect on the direction of Atlantic Sapphire i.e., Atlantic Sapphire and AquaBounty Technologies go up and down completely randomly.
Pair Corralation between Atlantic Sapphire and AquaBounty Technologies
Assuming the 90 days horizon Atlantic Sapphire ASA is expected to generate 29.75 times more return on investment than AquaBounty Technologies. However, Atlantic Sapphire is 29.75 times more volatile than AquaBounty Technologies. It trades about 0.21 of its potential returns per unit of risk. AquaBounty Technologies is currently generating about 0.15 per unit of risk. If you would invest 238.00 in Atlantic Sapphire ASA on October 26, 2024 and sell it today you would lose (98.00) from holding Atlantic Sapphire ASA or give up 41.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlantic Sapphire ASA vs. AquaBounty Technologies
Performance |
| Timeline |
| Atlantic Sapphire ASA |
| AquaBounty Technologies |
Atlantic Sapphire and AquaBounty Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlantic Sapphire and AquaBounty Technologies
The main advantage of trading using opposite Atlantic Sapphire and AquaBounty Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlantic Sapphire position performs unexpectedly, AquaBounty 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 AquaBounty Technologies will offset losses from the drop in AquaBounty Technologies' long position.| Atlantic Sapphire vs. Forafric Global PLC | Atlantic Sapphire vs. Forafric Global PLC | Atlantic Sapphire vs. GrainCorp Limited | Atlantic Sapphire vs. Australian Agricultural |
| AquaBounty Technologies vs. Atlantic Sapphire ASA | AquaBounty Technologies vs. Adecoagro SA | AquaBounty Technologies vs. Local Bounti Corp | AquaBounty Technologies vs. Forafric Global PLC |
Check out your portfolio center.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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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