Correlation Between Ion Beam and Anglo Asian
Can any of the company-specific risk be diversified away by investing in both Ion Beam and Anglo Asian 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 Ion Beam and Anglo Asian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ion Beam Applications and Anglo Asian Mining, you can compare the effects of market volatilities on Ion Beam and Anglo Asian 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 Ion Beam with a short position of Anglo Asian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ion Beam and Anglo Asian.
Diversification Opportunities for Ion Beam and Anglo Asian
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ion and Anglo is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Ion Beam Applications and Anglo Asian Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anglo Asian Mining and Ion Beam 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 Ion Beam Applications are associated (or correlated) with Anglo Asian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anglo Asian Mining has no effect on the direction of Ion Beam i.e., Ion Beam and Anglo Asian go up and down completely randomly.
Pair Corralation between Ion Beam and Anglo Asian
Assuming the 90 days trading horizon Ion Beam Applications is expected to generate 0.72 times more return on investment than Anglo Asian. However, Ion Beam Applications is 1.39 times less risky than Anglo Asian. It trades about -0.02 of its potential returns per unit of risk. Anglo Asian Mining is currently generating about -0.06 per unit of risk. If you would invest 1,323 in Ion Beam Applications on December 8, 2024 and sell it today you would lose (19.00) from holding Ion Beam Applications or give up 1.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ion Beam Applications vs. Anglo Asian Mining
Performance |
| Timeline |
| Ion Beam Applications |
| Anglo Asian Mining |
Ion Beam and Anglo Asian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ion Beam and Anglo Asian
The main advantage of trading using opposite Ion Beam and Anglo Asian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ion Beam position performs unexpectedly, Anglo Asian 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 Anglo Asian will offset losses from the drop in Anglo Asian's long position.| Ion Beam vs. BlackRock Frontiers Investment | ||
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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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