Correlation Between AquaBounty Technologies and Forafric Global

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

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

Diversification Opportunities for AquaBounty Technologies and Forafric Global

-0.5

Correlation Coefficient

AquaBounty Technologies  Forafric Global

Very good diversification

The 3 months correlation between AquaBounty and Forafric is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding AquaBounty Technologies and Forafric Global PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forafric Global PLC and AquaBounty Technologies 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 AquaBounty Technologies are associated (or correlated) with Forafric Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forafric Global PLC has no effect on the direction of AquaBounty Technologies i.e., AquaBounty Technologies and Forafric Global go up and down completely randomly.

Pair Corralation between AquaBounty Technologies and Forafric Global

Considering the 90-day investment horizon AquaBounty Technologies is expected to under-perform the Forafric Global. But the stock apears to be less risky and, when comparing its historical volatility, AquaBounty Technologies is 1.96 times less risky than Forafric Global. The stock trades about -0.04 of its potential returns per unit of risk. The Forafric Global PLC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  39.00  in Forafric Global PLC on May 6, 2025 and sell it today you would earn a total of  3.00  from holding Forafric Global PLC or generate 7.69% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	84.13%
Values	Daily Returns

AquaBounty Technologies  vs.  Forafric Global PLC

AquaBounty Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days AquaBounty Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Forafric Global PLC

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Forafric Global PLC are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal forward indicators, Forafric Global showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AquaBounty Technologies and Forafric Global

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

The idea behind AquaBounty Technologies and Forafric Global PLC 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.