Correlation Between AdCapital and ADYEN NV

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

By analyzing existing cross correlation between AdCapital AG and ADYEN NV UNSPADR001, you can compare the effects of market volatilities on AdCapital and ADYEN NV 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 AdCapital with a short position of ADYEN NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of AdCapital and ADYEN NV.

Diversification Opportunities for AdCapital and ADYEN NV

-0.63

Correlation Coefficient

AdCapital  ADYEN NV

Excellent diversification

The 3 months correlation between AdCapital and ADYEN is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding AdCapital AG and ADYEN NV UNSPADR001 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADYEN NV UNSPADR001 and AdCapital 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 AdCapital AG are associated (or correlated) with ADYEN NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADYEN NV UNSPADR001 has no effect on the direction of AdCapital i.e., AdCapital and ADYEN NV go up and down completely randomly.

Pair Corralation between AdCapital and ADYEN NV

Assuming the 90 days horizon AdCapital is expected to generate 3.15 times less return on investment than ADYEN NV. But when comparing it to its historical volatility, AdCapital AG is 1.26 times less risky than ADYEN NV. It trades about 0.02 of its potential returns per unit of risk. ADYEN NV UNSPADR001 is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,420  in ADYEN NV UNSPADR001 on April 24, 2025 and sell it today you would earn a total of  80.00  from holding ADYEN NV UNSPADR001 or generate 5.63% return on investment over 90 days.

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

AdCapital AG  vs.  ADYEN NV UNSPADR001

AdCapital AG

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AdCapital AG are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, AdCapital is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

ADYEN NV UNSPADR001

Risk-Adjusted Performance

Weak

Over the last 90 days ADYEN NV UNSPADR001 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly weak basic indicators, ADYEN NV may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with AdCapital and ADYEN NV

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

The idea behind AdCapital AG and ADYEN NV UNSPADR001 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.