Correlation Between AVE SA and VIDAVO SA

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

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

Diversification Opportunities for AVE SA and VIDAVO SA

-0.82

Correlation Coefficient

AVE SA  VIDAVO SA

Pay attention - limited upside

The 3 months correlation between AVE and VIDAVO is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding AVE SA and VIDAVO SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VIDAVO SA and AVE SA 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 AVE SA are associated (or correlated) with VIDAVO SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VIDAVO SA has no effect on the direction of AVE SA i.e., AVE SA and VIDAVO SA go up and down completely randomly.

Pair Corralation between AVE SA and VIDAVO SA

Assuming the 90 days trading horizon AVE SA is expected to generate 2.96 times more return on investment than VIDAVO SA. However, AVE SA is 2.96 times more volatile than VIDAVO SA. It trades about 0.12 of its potential returns per unit of risk. VIDAVO SA is currently generating about 0.0 per unit of risk. If you would invest  44.00  in AVE SA on April 24, 2025 and sell it today you would earn a total of  8.00  from holding AVE SA or generate 18.18% return on investment over 90 days.

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

AVE SA  vs.  VIDAVO SA

AVE SA

Risk-Adjusted Performance

OK

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

VIDAVO SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days VIDAVO SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, VIDAVO SA is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with AVE SA and VIDAVO SA

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

The idea behind AVE SA and VIDAVO 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.