Correlation Between AIR PRODCHEMICALS and YouGov Plc

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

By analyzing existing cross correlation between AIR PRODCHEMICALS and YouGov plc, you can compare the effects of market volatilities on AIR PRODCHEMICALS and YouGov Plc 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 AIR PRODCHEMICALS with a short position of YouGov Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIR PRODCHEMICALS and YouGov Plc.

Diversification Opportunities for AIR PRODCHEMICALS and YouGov Plc

-0.04

Correlation Coefficient

AIR PRODCHEMICALS  YouGov Plc

Good diversification

The 3 months correlation between AIR and YouGov is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding AIR PRODCHEMICALS and YouGov plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YouGov plc and AIR PRODCHEMICALS 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 AIR PRODCHEMICALS are associated (or correlated) with YouGov Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YouGov plc has no effect on the direction of AIR PRODCHEMICALS i.e., AIR PRODCHEMICALS and YouGov Plc go up and down completely randomly.

Pair Corralation between AIR PRODCHEMICALS and YouGov Plc

Assuming the 90 days trading horizon AIR PRODCHEMICALS is expected to under-perform the YouGov Plc. But the stock apears to be less risky and, when comparing its historical volatility, AIR PRODCHEMICALS is 3.51 times less risky than YouGov Plc. The stock trades about -0.73 of its potential returns per unit of risk. The YouGov plc is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest  520.00  in YouGov plc on September 29, 2024 and sell it today you would lose (32.00) from holding YouGov plc or give up 6.15% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.0%
Values	Daily Returns

AIR PRODCHEMICALS  vs.  YouGov plc

AIR PRODCHEMICALS

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in AIR PRODCHEMICALS are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, AIR PRODCHEMICALS may actually be approaching a critical reversion point that can send shares even higher in January 2025.

YouGov plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days YouGov plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, YouGov Plc is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with AIR PRODCHEMICALS and YouGov Plc

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

The idea behind AIR PRODCHEMICALS and YouGov plc 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.