Correlation Between Anglo Asian and Fresnillo PLC
Can any of the company-specific risk be diversified away by investing in both Anglo Asian and Fresnillo 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 Anglo Asian and Fresnillo PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anglo Asian Mining and Fresnillo PLC, you can compare the effects of market volatilities on Anglo Asian and Fresnillo 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 Anglo Asian with a short position of Fresnillo PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anglo Asian and Fresnillo PLC.
Diversification Opportunities for Anglo Asian and Fresnillo PLC
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Anglo and Fresnillo is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Anglo Asian Mining and Fresnillo PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fresnillo PLC and Anglo Asian 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 Anglo Asian Mining are associated (or correlated) with Fresnillo PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fresnillo PLC has no effect on the direction of Anglo Asian i.e., Anglo Asian and Fresnillo PLC go up and down completely randomly.
Pair Corralation between Anglo Asian and Fresnillo PLC
Assuming the 90 days trading horizon Anglo Asian Mining is expected to under-perform the Fresnillo PLC. But the stock apears to be less risky and, when comparing its historical volatility, Anglo Asian Mining is 1.01 times less risky than Fresnillo PLC. The stock trades about -0.38 of its potential returns per unit of risk. The Fresnillo PLC is currently generating about -0.3 of returns per unit of risk over similar time horizon. If you would invest 75,300 in Fresnillo PLC on August 28, 2024 and sell it today you would lose (12,000) from holding Fresnillo PLC or give up 15.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anglo Asian Mining vs. Fresnillo PLC
Performance |
| Timeline |
| Anglo Asian Mining |
| Fresnillo PLC |
Anglo Asian and Fresnillo PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anglo Asian and Fresnillo PLC
The main advantage of trading using opposite Anglo Asian and Fresnillo PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anglo Asian position performs unexpectedly, Fresnillo 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 Fresnillo PLC will offset losses from the drop in Fresnillo PLC's long position.| Anglo Asian vs. Advanced Medical Solutions | Anglo Asian vs. XLMedia PLC | Anglo Asian vs. Flow Traders NV | Anglo Asian vs. Medical Properties Trust |
| Fresnillo PLC vs. Givaudan SA | Fresnillo PLC vs. Antofagasta PLC | Fresnillo PLC vs. Centamin PLC | Fresnillo PLC vs. Atalaya Mining |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |