Correlation Between Ab Discovery and Touchstone Sands

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

By analyzing existing cross correlation between Ab Discovery Growth and Touchstone Sands Capital, you can compare the effects of market volatilities on Ab Discovery and Touchstone Sands 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 Ab Discovery with a short position of Touchstone Sands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Discovery and Touchstone Sands.

Diversification Opportunities for Ab Discovery and Touchstone Sands

0.78

Correlation Coefficient

Ab Discovery  Touchstone Sands

Poor diversification

The 3 months correlation between CHCLX and Touchstone is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Ab Discovery Growth and Touchstone Sands Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Sands Capital and Ab Discovery 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 Ab Discovery Growth are associated (or correlated) with Touchstone Sands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Sands Capital has no effect on the direction of Ab Discovery i.e., Ab Discovery and Touchstone Sands go up and down completely randomly.

Pair Corralation between Ab Discovery and Touchstone Sands

Assuming the 90 days horizon Ab Discovery Growth is expected to generate 1.01 times more return on investment than Touchstone Sands. However, Ab Discovery is 1.01 times more volatile than Touchstone Sands Capital. It trades about 0.1 of its potential returns per unit of risk. Touchstone Sands Capital is currently generating about 0.06 per unit of risk. If you would invest  1,187  in Ab Discovery Growth on August 2, 2025 and sell it today you would earn a total of  79.00  from holding Ab Discovery Growth or generate 6.66% return on investment over 90 days.

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

Ab Discovery Growth  vs.  Touchstone Sands Capital

Ab Discovery Growth

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Ab Discovery Growth are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak essential indicators, Ab Discovery may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Touchstone Sands Capital

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Touchstone Sands Capital are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Touchstone Sands is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Ab Discovery and Touchstone Sands

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

The idea behind Ab Discovery Growth and Touchstone Sands Capital 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.