Correlation Between AquaBounty Technologies and Village Farms
Can any of the company-specific risk be diversified away by investing in both AquaBounty Technologies and Village Farms 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 AquaBounty Technologies and Village Farms into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AquaBounty Technologies and Village Farms International, you can compare the effects of market volatilities on AquaBounty Technologies and Village Farms 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 AquaBounty Technologies with a short position of Village Farms. Check out your portfolio center. Please also check ongoing floating volatility patterns of AquaBounty Technologies and Village Farms.
Diversification Opportunities for AquaBounty Technologies and Village Farms
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between AquaBounty and Village is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding AquaBounty Technologies and Village Farms International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Village Farms Intern and AquaBounty Technologies 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 AquaBounty Technologies are associated (or correlated) with Village Farms. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Village Farms Intern has no effect on the direction of AquaBounty Technologies i.e., AquaBounty Technologies and Village Farms go up and down completely randomly.
Pair Corralation between AquaBounty Technologies and Village Farms
Considering the 90-day investment horizon AquaBounty Technologies is expected to under-perform the Village Farms. In addition to that, AquaBounty Technologies is 1.4 times more volatile than Village Farms International. It trades about -0.02 of its total potential returns per unit of risk. Village Farms International is currently generating about 0.03 per unit of volatility. If you would invest 68.00 in Village Farms International on August 25, 2024 and sell it today you would earn a total of 8.00 from holding Village Farms International or generate 11.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AquaBounty Technologies vs. Village Farms International
Performance |
| Timeline |
| AquaBounty Technologies |
| Village Farms Intern |
AquaBounty Technologies and Village Farms Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AquaBounty Technologies and Village Farms
The main advantage of trading using opposite AquaBounty Technologies and Village Farms positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AquaBounty Technologies position performs unexpectedly, Village Farms 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 Village Farms will offset losses from the drop in Village Farms' long position.| AquaBounty Technologies vs. Atlantic Sapphire ASA | AquaBounty Technologies vs. Local Bounti Corp | AquaBounty Technologies vs. Forafric Global PLC | AquaBounty Technologies vs. Forafric Global PLC |
| Village Farms vs. NaturalShrimp | Village Farms vs. AgriFORCE Growing Systems | Village Farms vs. Atlantic Sapphire ASA | Village Farms vs. Fresh Del Monte |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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