Correlation Between Graph and Alchemist

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

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

Diversification Opportunities for Graph and Alchemist

-0.34

Correlation Coefficient

Graph  Alchemist

Very good diversification

The 3 months correlation between Graph and Alchemist is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding The Graph and Alchemist AI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alchemist AI and Graph 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 The Graph are associated (or correlated) with Alchemist. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alchemist AI has no effect on the direction of Graph i.e., Graph and Alchemist go up and down completely randomly.

Pair Corralation between Graph and Alchemist

Assuming the 90 days trading horizon Graph is expected to generate 83.07 times less return on investment than Alchemist. But when comparing it to its historical volatility, The Graph is 21.55 times less risky than Alchemist. It trades about 0.03 of its potential returns per unit of risk. Alchemist AI is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  0.00  in Alchemist AI on May 1, 2025 and sell it today you would earn a total of  15.00  from holding Alchemist AI or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

The Graph  vs.  Alchemist AI

Graph

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in The Graph are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Graph may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Alchemist AI

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Alchemist AI are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Alchemist exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Graph and Alchemist

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

The idea behind The Graph and Alchemist AI 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.