Correlation Between AFC Energy and Calculus VCT

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

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

Diversification Opportunities for AFC Energy and Calculus VCT

0.0

Correlation Coefficient

AFC Energy  Calculus VCT

Pay attention - limited upside

The 3 months correlation between AFC and Calculus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AFC Energy plc and Calculus VCT plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calculus VCT plc and AFC Energy 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 AFC Energy plc are associated (or correlated) with Calculus VCT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calculus VCT plc has no effect on the direction of AFC Energy i.e., AFC Energy and Calculus VCT go up and down completely randomly.

Pair Corralation between AFC Energy and Calculus VCT

If you would invest  5,500  in Calculus VCT plc on April 21, 2025 and sell it today you would earn a total of  0.00  from holding Calculus VCT plc or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.45%
Values	Daily Returns

AFC Energy plc  vs.  Calculus VCT plc

AFC Energy plc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AFC Energy plc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, AFC Energy exhibited solid returns over the last few months and may actually be approaching a breakup point.

Calculus VCT plc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Calculus VCT plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Calculus VCT is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with AFC Energy and Calculus VCT

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

The idea behind AFC Energy plc and Calculus VCT 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.

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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.