Correlation Between Anglo American and Buyer Group
Can any of the company-specific risk be diversified away by investing in both Anglo American and Buyer Group 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 Anglo American and Buyer Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anglo American Platinum and Buyer Group International, you can compare the effects of market volatilities on Anglo American and Buyer Group 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 Anglo American with a short position of Buyer Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anglo American and Buyer Group.
Diversification Opportunities for Anglo American and Buyer Group
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Anglo and Buyer is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Anglo American Platinum and Buyer Group International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Buyer Group International and Anglo American 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 Anglo American Platinum are associated (or correlated) with Buyer Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Buyer Group International has no effect on the direction of Anglo American i.e., Anglo American and Buyer Group go up and down completely randomly.
Pair Corralation between Anglo American and Buyer Group
Assuming the 90 days horizon Anglo American is expected to generate 16.74 times less return on investment than Buyer Group. But when comparing it to its historical volatility, Anglo American Platinum is 1.27 times less risky than Buyer Group. It trades about 0.0 of its potential returns per unit of risk. Buyer Group International is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 0.36 in Buyer Group International on November 27, 2024 and sell it today you would lose (0.14) from holding Buyer Group International or give up 38.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 41.7% |
| Values | Daily Returns |
Anglo American Platinum vs. Buyer Group International
Performance |
| Timeline |
| Anglo American Platinum |
| Buyer Group International |
Anglo American and Buyer Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anglo American and Buyer Group
The main advantage of trading using opposite Anglo American and Buyer Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anglo American position performs unexpectedly, Buyer Group 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 Buyer Group will offset losses from the drop in Buyer Group's long position.| Anglo American vs. Capri Holdings | Anglo American vs. Triumph Apparel | Anglo American vs. Cementos Pacasmayo SAA | Anglo American vs. Genesco |
| Buyer Group vs. Brightrock Gold Corp | Buyer Group vs. Gold And Gemstone | Buyer Group vs. Mexus Gold Us | Buyer Group vs. Mineralrite Corporat |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |