Correlation Between Alaska Energy and Abrdn Asia
Can any of the company-specific risk be diversified away by investing in both Alaska Energy and Abrdn Asia 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 Alaska Energy and Abrdn Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alaska Energy Metals and abrdn Asia Pacific, you can compare the effects of market volatilities on Alaska Energy and Abrdn Asia 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 Alaska Energy with a short position of Abrdn Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alaska Energy and Abrdn Asia.
Diversification Opportunities for Alaska Energy and Abrdn Asia
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alaska and Abrdn is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Alaska Energy Metals and abrdn Asia Pacific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on abrdn Asia Pacific and Alaska Energy 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 Alaska Energy Metals are associated (or correlated) with Abrdn Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of abrdn Asia Pacific has no effect on the direction of Alaska Energy i.e., Alaska Energy and Abrdn Asia go up and down completely randomly.
Pair Corralation between Alaska Energy and Abrdn Asia
Assuming the 90 days trading horizon Alaska Energy Metals is expected to under-perform the Abrdn Asia. In addition to that, Alaska Energy is 10.44 times more volatile than abrdn Asia Pacific. It trades about -0.02 of its total potential returns per unit of risk. abrdn Asia Pacific is currently generating about 0.08 per unit of volatility. If you would invest 228.00 in abrdn Asia Pacific on August 31, 2024 and sell it today you would earn a total of 49.00 from holding abrdn Asia Pacific or generate 21.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Alaska Energy Metals vs. abrdn Asia Pacific
Performance |
| Timeline |
| Alaska Energy Metals |
| abrdn Asia Pacific |
Alaska Energy and Abrdn Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alaska Energy and Abrdn Asia
The main advantage of trading using opposite Alaska Energy and Abrdn Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alaska Energy position performs unexpectedly, Abrdn Asia 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 Abrdn Asia will offset losses from the drop in Abrdn Asia's long position.| Alaska Energy vs. Ramp Metals | Alaska Energy vs. Canlan Ice Sports | Alaska Energy vs. Boat Rocker Media | Alaska Energy vs. Andlauer Healthcare Gr |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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