Correlation Between Arctic Gold and Clean Motion

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

By analyzing existing cross correlation between Arctic Gold Publ and Clean Motion AB, you can compare the effects of market volatilities on Arctic Gold and Clean Motion 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 Arctic Gold with a short position of Clean Motion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arctic Gold and Clean Motion.

Diversification Opportunities for Arctic Gold and Clean Motion

-0.63

Correlation Coefficient

Arctic Gold  Clean Motion

Excellent diversification

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

Pair Corralation between Arctic Gold and Clean Motion

Assuming the 90 days trading horizon Arctic Gold Publ is expected to under-perform the Clean Motion. In addition to that, Arctic Gold is 1.11 times more volatile than Clean Motion AB. It trades about -0.06 of its total potential returns per unit of risk. Clean Motion AB is currently generating about 0.17 per unit of volatility. If you would invest  28.00  in Clean Motion AB on April 25, 2025 and sell it today you would earn a total of  21.00  from holding Clean Motion AB or generate 75.0% return on investment over 90 days.

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

Arctic Gold Publ  vs.  Clean Motion AB

Arctic Gold Publ

Risk-Adjusted Performance

Very Weak

Over the last 90 days Arctic Gold Publ has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in August 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Clean Motion AB

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Clean Motion AB are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Clean Motion unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Arctic Gold and Clean Motion

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

The idea behind Arctic Gold Publ and Clean Motion AB 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.