Correlation Between Alaris Equity and Mullen

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

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

Diversification Opportunities for Alaris Equity and Mullen

-0.29

Correlation Coefficient

Alaris Equity  Mullen

Very good diversification

The 3 months correlation between Alaris and Mullen is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Alaris Equity Partners and Mullen Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mullen Group and Alaris Equity 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 Alaris Equity Partners are associated (or correlated) with Mullen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mullen Group has no effect on the direction of Alaris Equity i.e., Alaris Equity and Mullen go up and down completely randomly.

Pair Corralation between Alaris Equity and Mullen

Assuming the 90 days trading horizon Alaris Equity Partners is expected to under-perform the Mullen. In addition to that, Alaris Equity is 1.08 times more volatile than Mullen Group. It trades about -0.04 of its total potential returns per unit of risk. Mullen Group is currently generating about -0.01 per unit of volatility. If you would invest  1,323  in Mullen Group on May 7, 2025 and sell it today you would lose (16.00) from holding Mullen Group or give up 1.21% of portfolio value over 90 days.

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

Alaris Equity Partners  vs.  Mullen Group

Alaris Equity Partners

Risk-Adjusted Performance

Weakest

Over the last 90 days Alaris Equity Partners has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Alaris Equity is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Mullen Group

Risk-Adjusted Performance

Weakest

Over the last 90 days Mullen Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy essential indicators, Mullen is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Alaris Equity and Mullen

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

The idea behind Alaris Equity Partners and Mullen Group 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.