Correlation Between Alcoa Corp and ONEOK
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By analyzing existing cross correlation between Alcoa Corp and ONEOK PARTNERS L, you can compare the effects of market volatilities on Alcoa Corp and ONEOK 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 Alcoa Corp with a short position of ONEOK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alcoa Corp and ONEOK.
Diversification Opportunities for Alcoa Corp and ONEOK
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alcoa and ONEOK is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Alcoa Corp and ONEOK PARTNERS L in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ONEOK PARTNERS L and Alcoa Corp 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 Alcoa Corp are associated (or correlated) with ONEOK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ONEOK PARTNERS L has no effect on the direction of Alcoa Corp i.e., Alcoa Corp and ONEOK go up and down completely randomly.
Pair Corralation between Alcoa Corp and ONEOK
Allowing for the 90-day total investment horizon Alcoa Corp is expected to generate 2.45 times more return on investment than ONEOK. However, Alcoa Corp is 2.45 times more volatile than ONEOK PARTNERS L. It trades about 0.18 of its potential returns per unit of risk. ONEOK PARTNERS L is currently generating about 0.02 per unit of risk. If you would invest 4,096 in Alcoa Corp on August 30, 2024 and sell it today you would earn a total of 492.00 from holding Alcoa Corp or generate 12.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 77.27% |
| Values | Daily Returns |
Alcoa Corp vs. ONEOK PARTNERS L
Performance |
| Timeline |
| Alcoa Corp |
| ONEOK PARTNERS L |
Alcoa Corp and ONEOK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alcoa Corp and ONEOK
The main advantage of trading using opposite Alcoa Corp and ONEOK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alcoa Corp position performs unexpectedly, ONEOK 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 ONEOK will offset losses from the drop in ONEOK's long position.| Alcoa Corp vs. Direxion Daily FTSE | Alcoa Corp vs. Dodge Global Stock | Alcoa Corp vs. Collegium Pharmaceutical | Alcoa Corp vs. Dreyfus Natural Resources |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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