Correlation Between ALTAIR RES and Caterpillar
Can any of the company-specific risk be diversified away by investing in both ALTAIR RES and Caterpillar 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 ALTAIR RES and Caterpillar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALTAIR RES INC and Caterpillar, you can compare the effects of market volatilities on ALTAIR RES and Caterpillar 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 ALTAIR RES with a short position of Caterpillar. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALTAIR RES and Caterpillar.
Diversification Opportunities for ALTAIR RES and Caterpillar
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ALTAIR and Caterpillar is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ALTAIR RES INC and Caterpillar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caterpillar and ALTAIR RES 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 ALTAIR RES INC are associated (or correlated) with Caterpillar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caterpillar has no effect on the direction of ALTAIR RES i.e., ALTAIR RES and Caterpillar go up and down completely randomly.
Pair Corralation between ALTAIR RES and Caterpillar
If you would invest 25,557 in Caterpillar on September 12, 2024 and sell it today you would earn a total of 12,443 from holding Caterpillar or generate 48.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
ALTAIR RES INC vs. Caterpillar
Performance |
| Timeline |
| ALTAIR RES INC |
| Caterpillar |
ALTAIR RES and Caterpillar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALTAIR RES and Caterpillar
The main advantage of trading using opposite ALTAIR RES and Caterpillar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALTAIR RES position performs unexpectedly, Caterpillar 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 Caterpillar will offset losses from the drop in Caterpillar's long position.| ALTAIR RES vs. American Lithium Corp | ALTAIR RES vs. ADRIATIC METALS LS 013355 | ALTAIR RES vs. Superior Plus Corp | ALTAIR RES vs. SIVERS SEMICONDUCTORS AB |
| Caterpillar vs. AB Volvo | Caterpillar vs. Daimler Truck Holding | Caterpillar vs. Superior Plus Corp | Caterpillar vs. SIVERS SEMICONDUCTORS AB |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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