Correlation Between Current Water and Imaflex

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

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

Diversification Opportunities for Current Water and Imaflex

-0.47

Correlation Coefficient

Current Water  Imaflex

Very good diversification

The 3 months correlation between Current and Imaflex is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Current Water Technologies and Imaflex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imaflex and Current Water 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 Current Water Technologies are associated (or correlated) with Imaflex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imaflex has no effect on the direction of Current Water i.e., Current Water and Imaflex go up and down completely randomly.

Pair Corralation between Current Water and Imaflex

Assuming the 90 days trading horizon Current Water Technologies is expected to under-perform the Imaflex. In addition to that, Current Water is 2.42 times more volatile than Imaflex. It trades about -0.03 of its total potential returns per unit of risk. Imaflex is currently generating about 0.12 per unit of volatility. If you would invest  103.00  in Imaflex on April 22, 2025 and sell it today you would earn a total of  26.00  from holding Imaflex or generate 25.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

Current Water Technologies  vs.  Imaflex

Current Water Techno

Risk-Adjusted Performance

Very Weak

Over the last 90 days Current Water Technologies 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 fairly stable which may send shares a bit higher in August 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Imaflex

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Imaflex are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Imaflex showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Current Water and Imaflex

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

The idea behind Current Water Technologies and Imaflex 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.

Check out your portfolio center.

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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .