Correlation Between 2020 Bulkers and Avance Gas

Can any of the company-specific risk be diversified away by investing in both 2020 Bulkers and Avance Gas 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 2020 Bulkers and Avance Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 2020 Bulkers and Avance Gas Holding, you can compare the effects of market volatilities on 2020 Bulkers and Avance Gas 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 2020 Bulkers with a short position of Avance Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of 2020 Bulkers and Avance Gas.

Diversification Opportunities for 2020 Bulkers and Avance Gas

-0.79

Correlation Coefficient

2020 Bulkers  Avance Gas

Pay attention - limited upside

The 3 months correlation between 2020 and Avance is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding 2020 Bulkers and Avance Gas Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avance Gas Holding and 2020 Bulkers 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 2020 Bulkers are associated (or correlated) with Avance Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avance Gas Holding has no effect on the direction of 2020 Bulkers i.e., 2020 Bulkers and Avance Gas go up and down completely randomly.

Pair Corralation between 2020 Bulkers and Avance Gas

Assuming the 90 days trading horizon 2020 Bulkers is expected to generate 0.17 times more return on investment than Avance Gas. However, 2020 Bulkers is 5.91 times less risky than Avance Gas. It trades about 0.21 of its potential returns per unit of risk. Avance Gas Holding is currently generating about -0.27 per unit of risk. If you would invest  9,858  in 2020 Bulkers on April 22, 2025 and sell it today you would earn a total of  2,732  from holding 2020 Bulkers or generate 27.71% return on investment over 90 days.

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

2020 Bulkers  vs.  Avance Gas Holding

2020 Bulkers

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in 2020 Bulkers are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting essential indicators, 2020 Bulkers disclosed solid returns over the last few months and may actually be approaching a breakup point.

Avance Gas Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Avance Gas Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in August 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with 2020 Bulkers and Avance Gas

The main advantage of trading using opposite 2020 Bulkers and Avance Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 2020 Bulkers position performs unexpectedly, Avance Gas 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 Avance Gas will offset losses from the drop in Avance Gas' long position.

The idea behind 2020 Bulkers and Avance Gas Holding 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.