Correlation Between VELA TECHNOLPLC and Aristocrat Leisure

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

By analyzing existing cross correlation between VELA TECHNOLPLC LS 0001 and Aristocrat Leisure Limited, you can compare the effects of market volatilities on VELA TECHNOLPLC and Aristocrat Leisure 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 VELA TECHNOLPLC with a short position of Aristocrat Leisure. Check out your portfolio center. Please also check ongoing floating volatility patterns of VELA TECHNOLPLC and Aristocrat Leisure.

Diversification Opportunities for VELA TECHNOLPLC and Aristocrat Leisure

0.0

Correlation Coefficient

VELA TECHNOLPLC  Aristocrat Leisure

Pay attention - limited upside

The 3 months correlation between VELA and Aristocrat is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding VELA TECHNOLPLC LS 0001 and Aristocrat Leisure Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aristocrat Leisure and VELA TECHNOLPLC 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 VELA TECHNOLPLC LS 0001 are associated (or correlated) with Aristocrat Leisure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aristocrat Leisure has no effect on the direction of VELA TECHNOLPLC i.e., VELA TECHNOLPLC and Aristocrat Leisure go up and down completely randomly.

Pair Corralation between VELA TECHNOLPLC and Aristocrat Leisure

If you would invest  3,534  in Aristocrat Leisure Limited on April 24, 2025 and sell it today you would earn a total of  206.00  from holding Aristocrat Leisure Limited or generate 5.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

VELA TECHNOLPLC LS 0001  vs.  Aristocrat Leisure Limited

VELA TECHNOLPLC LS

Risk-Adjusted Performance

Very Weak

Over the last 90 days VELA TECHNOLPLC LS 0001 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, VELA TECHNOLPLC is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Aristocrat Leisure

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Aristocrat Leisure Limited are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Aristocrat Leisure may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with VELA TECHNOLPLC and Aristocrat Leisure

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

The idea behind VELA TECHNOLPLC LS 0001 and Aristocrat Leisure Limited 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.