Correlation Between BASE and Adcore

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

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

Diversification Opportunities for BASE and Adcore

-0.23

Correlation Coefficient

BASE  Adcore

Very good diversification

The 3 months correlation between BASE and Adcore is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding BASE Inc and Adcore Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adcore Inc and BASE 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 BASE Inc are associated (or correlated) with Adcore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adcore Inc has no effect on the direction of BASE i.e., BASE and Adcore go up and down completely randomly.

Pair Corralation between BASE and Adcore

Assuming the 90 days horizon BASE Inc is expected to under-perform the Adcore. But the pink sheet apears to be less risky and, when comparing its historical volatility, BASE Inc is 2.1 times less risky than Adcore. The pink sheet trades about -0.01 of its potential returns per unit of risk. The Adcore Inc is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  20.00  in Adcore Inc on May 1, 2025 and sell it today you would earn a total of  0.00  from holding Adcore Inc or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

BASE Inc  vs.  Adcore Inc

BASE Inc

Risk-Adjusted Performance

Very Weak

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

Adcore Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Adcore Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Adcore may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with BASE and Adcore

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

The idea behind BASE Inc and Adcore Inc 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.