Correlation Between AER Energy and Parafin Corp
Can any of the company-specific risk be diversified away by investing in both AER Energy and Parafin Corp 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 AER Energy and Parafin Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AER Energy Resources and Parafin Corp, you can compare the effects of market volatilities on AER Energy and Parafin Corp 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 AER Energy with a short position of Parafin Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of AER Energy and Parafin Corp.
Diversification Opportunities for AER Energy and Parafin Corp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AER and Parafin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AER Energy Resources and Parafin Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parafin Corp and AER 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 AER Energy Resources are associated (or correlated) with Parafin Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parafin Corp has no effect on the direction of AER Energy i.e., AER Energy and Parafin Corp go up and down completely randomly.
Pair Corralation between AER Energy and Parafin Corp
If you would invest (100.00) in Parafin Corp on November 27, 2024 and sell it today you would earn a total of 100.00 from holding Parafin Corp or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
AER Energy Resources vs. Parafin Corp
Performance |
| Timeline |
| AER Energy Resources |
| Parafin Corp |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
AER Energy and Parafin Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AER Energy and Parafin Corp
The main advantage of trading using opposite AER Energy and Parafin Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AER Energy position performs unexpectedly, Parafin Corp 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 Parafin Corp will offset losses from the drop in Parafin Corp's long position.| AER Energy vs. Caduceus Software Systems | AER Energy vs. North Springs Resources | AER Energy vs. Nyxio Tech Corp | AER Energy vs. Access Power Co |
| Parafin Corp vs. Imperial Res | Parafin Corp vs. Strat Petroleum | Parafin Corp vs. Century Petroleum Corp |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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