Correlation Between Aqua Metals and LanzaTech Global
Can any of the company-specific risk be diversified away by investing in both Aqua Metals and LanzaTech Global 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 Aqua Metals and LanzaTech Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqua Metals and LanzaTech Global, you can compare the effects of market volatilities on Aqua Metals and LanzaTech Global 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 Aqua Metals with a short position of LanzaTech Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqua Metals and LanzaTech Global.
Diversification Opportunities for Aqua Metals and LanzaTech Global
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Aqua and LanzaTech is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Aqua Metals and LanzaTech Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LanzaTech Global and Aqua Metals 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 Aqua Metals are associated (or correlated) with LanzaTech Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LanzaTech Global has no effect on the direction of Aqua Metals i.e., Aqua Metals and LanzaTech Global go up and down completely randomly.
Pair Corralation between Aqua Metals and LanzaTech Global
Given the investment horizon of 90 days Aqua Metals is expected to under-perform the LanzaTech Global. But the stock apears to be less risky and, when comparing its historical volatility, Aqua Metals is 1.07 times less risky than LanzaTech Global. The stock trades about -0.07 of its potential returns per unit of risk. The LanzaTech Global is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 338.00 in LanzaTech Global on August 24, 2024 and sell it today you would lose (232.00) from holding LanzaTech Global or give up 68.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aqua Metals vs. LanzaTech Global
Performance |
| Timeline |
| Aqua Metals |
| LanzaTech Global |
Aqua Metals and LanzaTech Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqua Metals and LanzaTech Global
The main advantage of trading using opposite Aqua Metals and LanzaTech Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqua Metals position performs unexpectedly, LanzaTech Global 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 LanzaTech Global will offset losses from the drop in LanzaTech Global's long position.| Aqua Metals vs. LanzaTech Global | Aqua Metals vs. Waste Management | Aqua Metals vs. Clean Harbors | Aqua Metals vs. Casella Waste Systems |
| LanzaTech Global vs. Casella Waste Systems | LanzaTech Global vs. Montrose Environmental Grp | LanzaTech Global vs. Clean Harbors | LanzaTech Global vs. Gfl Environmental Holdings |
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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