Correlation Between Actinogen Medical and Metro Mining
Can any of the company-specific risk be diversified away by investing in both Actinogen Medical and Metro Mining 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 Actinogen Medical and Metro Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Actinogen Medical and Metro Mining, you can compare the effects of market volatilities on Actinogen Medical and Metro Mining 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 Actinogen Medical with a short position of Metro Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Actinogen Medical and Metro Mining.
Diversification Opportunities for Actinogen Medical and Metro Mining
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Actinogen and Metro is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Actinogen Medical and Metro Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Mining and Actinogen Medical 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 Actinogen Medical are associated (or correlated) with Metro Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Mining has no effect on the direction of Actinogen Medical i.e., Actinogen Medical and Metro Mining go up and down completely randomly.
Pair Corralation between Actinogen Medical and Metro Mining
Assuming the 90 days trading horizon Actinogen Medical is expected to generate 1.04 times more return on investment than Metro Mining. However, Actinogen Medical is 1.04 times more volatile than Metro Mining. It trades about 0.17 of its potential returns per unit of risk. Metro Mining is currently generating about 0.11 per unit of risk. If you would invest 2.50 in Actinogen Medical on November 5, 2024 and sell it today you would earn a total of 0.20 from holding Actinogen Medical or generate 8.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Actinogen Medical vs. Metro Mining
Performance |
| Timeline |
| Actinogen Medical |
| Metro Mining |
Actinogen Medical and Metro Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Actinogen Medical and Metro Mining
The main advantage of trading using opposite Actinogen Medical and Metro Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Actinogen Medical position performs unexpectedly, Metro Mining 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 Metro Mining will offset losses from the drop in Metro Mining's long position.| Actinogen Medical vs. Hotel Property Investments | Actinogen Medical vs. Dynamic Drill And | Actinogen Medical vs. Nufarm | Actinogen Medical vs. Insignia Financial |
| Metro Mining vs. Northern Star Resources | Metro Mining vs. Evolution Mining | Metro Mining vs. Bluescope Steel | Metro Mining vs. De Grey 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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