Correlation Between Alpha Services and Admie Holding

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

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

Diversification Opportunities for Alpha Services and Admie Holding

0.89

Correlation Coefficient

Alpha Services  Admie Holding

Very poor diversification

The 3 months correlation between Alpha and Admie is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Services and and Admie Holding SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Admie Holding SA and Alpha Services 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 Alpha Services and are associated (or correlated) with Admie Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Admie Holding SA has no effect on the direction of Alpha Services i.e., Alpha Services and Admie Holding go up and down completely randomly.

Pair Corralation between Alpha Services and Admie Holding

Assuming the 90 days trading horizon Alpha Services and is expected to generate 1.36 times more return on investment than Admie Holding. However, Alpha Services is 1.36 times more volatile than Admie Holding SA. It trades about 0.32 of its potential returns per unit of risk. Admie Holding SA is currently generating about 0.19 per unit of risk. If you would invest  216.00  in Alpha Services and on April 22, 2025 and sell it today you would earn a total of  119.00  from holding Alpha Services and or generate 55.09% return on investment over 90 days.

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

Alpha Services and  vs.  Admie Holding SA

Alpha Services

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Alpha Services and are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Alpha Services sustained solid returns over the last few months and may actually be approaching a breakup point.

Admie Holding SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Admie Holding SA are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Admie Holding sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Alpha Services and Admie Holding

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

The idea behind Alpha Services and and Admie Holding 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.

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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.