Correlation Between Ross Stores and Antofagasta PLC
Can any of the company-specific risk be diversified away by investing in both Ross Stores and Antofagasta PLC 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 Ross Stores and Antofagasta PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ross Stores and Antofagasta PLC, you can compare the effects of market volatilities on Ross Stores and Antofagasta PLC 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 Ross Stores with a short position of Antofagasta PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and Antofagasta PLC.
Diversification Opportunities for Ross Stores and Antofagasta PLC
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ross and Antofagasta is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and Antofagasta PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Antofagasta PLC and Ross Stores 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 Ross Stores are associated (or correlated) with Antofagasta PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Antofagasta PLC has no effect on the direction of Ross Stores i.e., Ross Stores and Antofagasta PLC go up and down completely randomly.
Pair Corralation between Ross Stores and Antofagasta PLC
Assuming the 90 days trading horizon Ross Stores is expected to generate 0.77 times more return on investment than Antofagasta PLC. However, Ross Stores is 1.3 times less risky than Antofagasta PLC. It trades about 0.3 of its potential returns per unit of risk. Antofagasta PLC is currently generating about -0.11 per unit of risk. If you would invest 13,935 in Ross Stores on August 31, 2024 and sell it today you would earn a total of 1,613 from holding Ross Stores or generate 11.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ross Stores vs. Antofagasta PLC
Performance |
| Timeline |
| Ross Stores |
| Antofagasta PLC |
Ross Stores and Antofagasta PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ross Stores and Antofagasta PLC
The main advantage of trading using opposite Ross Stores and Antofagasta PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ross Stores position performs unexpectedly, Antofagasta PLC 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 Antofagasta PLC will offset losses from the drop in Antofagasta PLC's long position.| Ross Stores vs. Centaur Media | Ross Stores vs. Everyman Media Group | Ross Stores vs. bet at home AG | Ross Stores vs. MediaZest plc |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |