Correlation Between 22nd Century and Aquagold International
Can any of the company-specific risk be diversified away by investing in both 22nd Century and Aquagold International 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 22nd Century and Aquagold International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 22nd Century Group and Aquagold International, you can compare the effects of market volatilities on 22nd Century and Aquagold International 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 22nd Century with a short position of Aquagold International. Check out your portfolio center. Please also check ongoing floating volatility patterns of 22nd Century and Aquagold International.
Diversification Opportunities for 22nd Century and Aquagold International
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 22nd and Aquagold is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding 22nd Century Group and Aquagold International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquagold International and 22nd Century 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 22nd Century Group are associated (or correlated) with Aquagold International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquagold International has no effect on the direction of 22nd Century i.e., 22nd Century and Aquagold International go up and down completely randomly.
Pair Corralation between 22nd Century and Aquagold International
Given the investment horizon of 90 days 22nd Century Group is expected to under-perform the Aquagold International. In addition to that, 22nd Century is 2.09 times more volatile than Aquagold International. It trades about -0.09 of its total potential returns per unit of risk. Aquagold International is currently generating about -0.03 per unit of volatility. If you would invest 2.10 in Aquagold International on August 27, 2024 and sell it today you would lose (1.50) from holding Aquagold International or give up 71.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
22nd Century Group vs. Aquagold International
Performance |
| Timeline |
| 22nd Century Group |
| Aquagold International |
22nd Century and Aquagold International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 22nd Century and Aquagold International
The main advantage of trading using opposite 22nd Century and Aquagold International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 22nd Century position performs unexpectedly, Aquagold International 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 Aquagold International will offset losses from the drop in Aquagold International's long position.| 22nd Century vs. Turning Point Brands | 22nd Century vs. Green Globe International | 22nd Century vs. Imperial Brands PLC | 22nd Century vs. Kaival Brands Innovations |
| Aquagold International vs. PepsiCo | Aquagold International vs. Coca Cola Consolidated | Aquagold International vs. Monster Beverage Corp | Aquagold International vs. Celsius 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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