Correlation Between X Trade and Ailleron

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

By analyzing existing cross correlation between X Trade Brokers and Ailleron SA, you can compare the effects of market volatilities on X Trade and Ailleron 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 X Trade with a short position of Ailleron. Check out your portfolio center. Please also check ongoing floating volatility patterns of X Trade and Ailleron.

Diversification Opportunities for X Trade and Ailleron

0.43

Correlation Coefficient

X Trade  Ailleron

Very weak diversification

The 3 months correlation between XTB and Ailleron is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding X Trade Brokers and Ailleron SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ailleron SA and X Trade 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 X Trade Brokers are associated (or correlated) with Ailleron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ailleron SA has no effect on the direction of X Trade i.e., X Trade and Ailleron go up and down completely randomly.

Pair Corralation between X Trade and Ailleron

Assuming the 90 days trading horizon X Trade is expected to generate 27.98 times less return on investment than Ailleron. In addition to that, X Trade is 1.29 times more volatile than Ailleron SA. It trades about 0.0 of its total potential returns per unit of risk. Ailleron SA is currently generating about 0.1 per unit of volatility. If you would invest  1,724  in Ailleron SA on September 28, 2024 and sell it today you would earn a total of  396.00  from holding Ailleron SA or generate 22.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

X Trade Brokers  vs.  Ailleron SA

X Trade Brokers

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in X Trade Brokers are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, X Trade reported solid returns over the last few months and may actually be approaching a breakup point.

Ailleron SA

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ailleron SA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Ailleron is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with X Trade and Ailleron

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

The idea behind X Trade Brokers and Ailleron SA 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.

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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.