Correlation Between AMG Advanced and Atalaya Mining
Can any of the company-specific risk be diversified away by investing in both AMG Advanced and Atalaya Mining 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 AMG Advanced and Atalaya Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMG Advanced Metallurgical and Atalaya Mining, you can compare the effects of market volatilities on AMG Advanced and Atalaya Mining 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 AMG Advanced with a short position of Atalaya Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMG Advanced and Atalaya Mining.
Diversification Opportunities for AMG Advanced and Atalaya Mining
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AMG and Atalaya is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding AMG Advanced Metallurgical and Atalaya Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atalaya Mining and AMG Advanced 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 AMG Advanced Metallurgical are associated (or correlated) with Atalaya Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atalaya Mining has no effect on the direction of AMG Advanced i.e., AMG Advanced and Atalaya Mining go up and down completely randomly.
Pair Corralation between AMG Advanced and Atalaya Mining
Assuming the 90 days trading horizon AMG Advanced Metallurgical is expected to under-perform the Atalaya Mining. In addition to that, AMG Advanced is 1.09 times more volatile than Atalaya Mining. It trades about -0.06 of its total potential returns per unit of risk. Atalaya Mining is currently generating about 0.02 per unit of volatility. If you would invest 30,546 in Atalaya Mining on September 23, 2024 and sell it today you would earn a total of 2,804 from holding Atalaya Mining or generate 9.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMG Advanced Metallurgical vs. Atalaya Mining
Performance |
| Timeline |
| AMG Advanced Metallu |
| Atalaya Mining |
AMG Advanced and Atalaya Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMG Advanced and Atalaya Mining
The main advantage of trading using opposite AMG Advanced and Atalaya Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMG Advanced position performs unexpectedly, Atalaya Mining 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 Atalaya Mining will offset losses from the drop in Atalaya Mining's long position.| AMG Advanced vs. GoldMining | AMG Advanced vs. McEwen Mining | AMG Advanced vs. Blackstone Loan Financing | AMG Advanced vs. Hochschild Mining plc |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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