Correlation Between Actinogen Medical and National Australia
Can any of the company-specific risk be diversified away by investing in both Actinogen Medical and National Australia 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 National Australia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Actinogen Medical and National Australia Bank, you can compare the effects of market volatilities on Actinogen Medical and National Australia 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 National Australia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Actinogen Medical and National Australia.
Diversification Opportunities for Actinogen Medical and National Australia
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Actinogen and National is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Actinogen Medical and National Australia Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Australia Bank 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 National Australia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Australia Bank has no effect on the direction of Actinogen Medical i.e., Actinogen Medical and National Australia go up and down completely randomly.
Pair Corralation between Actinogen Medical and National Australia
Assuming the 90 days trading horizon Actinogen Medical is expected to generate 20.12 times more return on investment than National Australia. However, Actinogen Medical is 20.12 times more volatile than National Australia Bank. It trades about 0.17 of its potential returns per unit of risk. National Australia Bank is currently generating about -0.18 per unit of risk. If you would invest 2.40 in Actinogen Medical on September 15, 2024 and sell it today you would earn a total of 0.40 from holding Actinogen Medical or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Actinogen Medical vs. National Australia Bank
Performance |
| Timeline |
| Actinogen Medical |
| National Australia Bank |
Actinogen Medical and National Australia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Actinogen Medical and National Australia
The main advantage of trading using opposite Actinogen Medical and National Australia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Actinogen Medical position performs unexpectedly, National Australia 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 National Australia will offset losses from the drop in National Australia's long position.| Actinogen Medical vs. Farm Pride Foods | Actinogen Medical vs. Beston Global Food | Actinogen Medical vs. Tombador Iron | Actinogen Medical vs. Champion Iron |
| National Australia vs. Westpac Banking | National Australia vs. De Grey Mining | National Australia vs. Pointsbet Holdings | National Australia vs. Indiana 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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