Correlation Between Amedeo Air and Golden Metal
Can any of the company-specific risk be diversified away by investing in both Amedeo Air and Golden Metal 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 Amedeo Air and Golden Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amedeo Air Four and Golden Metal Resources, you can compare the effects of market volatilities on Amedeo Air and Golden Metal 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 Amedeo Air with a short position of Golden Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amedeo Air and Golden Metal.
Diversification Opportunities for Amedeo Air and Golden Metal
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amedeo and Golden is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Amedeo Air Four and Golden Metal Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Metal Resources and Amedeo Air 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 Amedeo Air Four are associated (or correlated) with Golden Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Metal Resources has no effect on the direction of Amedeo Air i.e., Amedeo Air and Golden Metal go up and down completely randomly.
Pair Corralation between Amedeo Air and Golden Metal
Assuming the 90 days trading horizon Amedeo Air Four is expected to generate 1.9 times more return on investment than Golden Metal. However, Amedeo Air is 1.9 times more volatile than Golden Metal Resources. It trades about 0.12 of its potential returns per unit of risk. Golden Metal Resources is currently generating about 0.06 per unit of risk. If you would invest 5,606 in Amedeo Air Four on November 5, 2024 and sell it today you would earn a total of 664.00 from holding Amedeo Air Four or generate 11.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amedeo Air Four vs. Golden Metal Resources
Performance |
| Timeline |
| Amedeo Air Four |
| Golden Metal Resources |
Amedeo Air and Golden Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amedeo Air and Golden Metal
The main advantage of trading using opposite Amedeo Air and Golden Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amedeo Air position performs unexpectedly, Golden Metal 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 Golden Metal will offset losses from the drop in Golden Metal's long position.| Amedeo Air vs. Zoom Video Communications | Amedeo Air vs. Verizon Communications | Amedeo Air vs. Batm Advanced Communications | Amedeo Air vs. Melia Hotels |
| Golden Metal vs. Taiwan Semiconductor Manufacturing | Golden Metal vs. Lindsell Train Investment | Golden Metal vs. United Airlines Holdings | Golden Metal vs. Tatton Asset Management |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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