Correlation Between Poxel SA and AB Science

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

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

Diversification Opportunities for Poxel SA and AB Science

-0.69

Correlation Coefficient

Poxel SA  AB Science

Excellent diversification

The 3 months correlation between Poxel and AB Science is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Poxel SA and AB Science SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AB Science SA and Poxel 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 Poxel SA are associated (or correlated) with AB Science. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AB Science SA has no effect on the direction of Poxel SA i.e., Poxel SA and AB Science go up and down completely randomly.

Pair Corralation between Poxel SA and AB Science

Assuming the 90 days trading horizon Poxel SA is expected to generate 2.0 times more return on investment than AB Science. However, Poxel SA is 2.0 times more volatile than AB Science SA. It trades about 0.09 of its potential returns per unit of risk. AB Science SA is currently generating about -0.05 per unit of risk. If you would invest  43.00  in Poxel SA on April 24, 2025 and sell it today you would earn a total of  14.00  from holding Poxel SA or generate 32.56% return on investment over 90 days.

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

Poxel SA  vs.  AB Science SA

Poxel SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Poxel SA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Poxel SA reported solid returns over the last few months and may actually be approaching a breakup point.

AB Science SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days AB Science SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Poxel SA and AB Science

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

The idea behind Poxel SA and AB Science 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.