Correlation Between ACG Metals and Balchem
Can any of the company-specific risk be diversified away by investing in both ACG Metals and Balchem 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 ACG Metals and Balchem into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ACG Metals Limited and Balchem, you can compare the effects of market volatilities on ACG Metals and Balchem 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 ACG Metals with a short position of Balchem. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACG Metals and Balchem.
Diversification Opportunities for ACG Metals and Balchem
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ACG and Balchem is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ACG Metals Limited and Balchem in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Balchem and ACG Metals 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 ACG Metals Limited are associated (or correlated) with Balchem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Balchem has no effect on the direction of ACG Metals i.e., ACG Metals and Balchem go up and down completely randomly.
Pair Corralation between ACG Metals and Balchem
If you would invest 14,028 in Balchem on September 1, 2024 and sell it today you would earn a total of 4,024 from holding Balchem or generate 28.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.04% |
| Values | Daily Returns |
ACG Metals Limited vs. Balchem
Performance |
| Timeline |
| ACG Metals Limited |
| Balchem |
ACG Metals and Balchem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ACG Metals and Balchem
The main advantage of trading using opposite ACG Metals and Balchem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACG Metals position performs unexpectedly, Balchem 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 Balchem will offset losses from the drop in Balchem's long position.| ACG Metals vs. Legacy Education | ACG Metals vs. Apple Inc | ACG Metals vs. NVIDIA | ACG Metals vs. Microsoft |
| Balchem vs. Sensient Technologies | Balchem vs. Innospec | Balchem vs. Minerals Technologies | Balchem vs. Oil Dri |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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