Correlation Between Aalberts Industries and Add Value

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

By analyzing existing cross correlation between Aalberts Industries NV and Add Value Fund, you can compare the effects of market volatilities on Aalberts Industries and Add Value 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 Aalberts Industries with a short position of Add Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aalberts Industries and Add Value.

Diversification Opportunities for Aalberts Industries and Add Value

0.67

Correlation Coefficient

Aalberts Industries  Add Value

Poor diversification

The 3 months correlation between Aalberts and Add is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Aalberts Industries NV and Add Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Add Value Fund and Aalberts Industries 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 Aalberts Industries NV are associated (or correlated) with Add Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Add Value Fund has no effect on the direction of Aalberts Industries i.e., Aalberts Industries and Add Value go up and down completely randomly.

Pair Corralation between Aalberts Industries and Add Value

Assuming the 90 days trading horizon Aalberts Industries is expected to generate 1.11 times less return on investment than Add Value. In addition to that, Aalberts Industries is 1.47 times more volatile than Add Value Fund. It trades about 0.12 of its total potential returns per unit of risk. Add Value Fund is currently generating about 0.2 per unit of volatility. If you would invest  9,136  in Add Value Fund on April 24, 2025 and sell it today you would earn a total of  1,403  from holding Add Value Fund or generate 15.36% return on investment over 90 days.

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

Aalberts Industries NV  vs.  Add Value Fund

Aalberts Industries

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aalberts Industries NV are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Aalberts Industries unveiled solid returns over the last few months and may actually be approaching a breakup point.

Add Value Fund

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Add Value Fund are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat unfluctuating basic indicators, Add Value sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aalberts Industries and Add Value

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

The idea behind Aalberts Industries NV and Add Value Fund 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 Transaction History module to view history of all your transactions and understand their impact on performance.