Correlation Between AKITA Drilling and International Metals
Can any of the company-specific risk be diversified away by investing in both AKITA Drilling and International Metals 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 AKITA Drilling and International Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AKITA Drilling and International Metals Mining, you can compare the effects of market volatilities on AKITA Drilling and International Metals 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 AKITA Drilling with a short position of International Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of AKITA Drilling and International Metals.
Diversification Opportunities for AKITA Drilling and International Metals
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AKITA and International is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding AKITA Drilling and International Metals Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Metals and AKITA Drilling 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 AKITA Drilling are associated (or correlated) with International Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Metals has no effect on the direction of AKITA Drilling i.e., AKITA Drilling and International Metals go up and down completely randomly.
Pair Corralation between AKITA Drilling and International Metals
Assuming the 90 days trading horizon AKITA Drilling is expected to generate 0.2 times more return on investment than International Metals. However, AKITA Drilling is 5.01 times less risky than International Metals. It trades about 0.1 of its potential returns per unit of risk. International Metals Mining is currently generating about -0.11 per unit of risk. If you would invest 162.00 in AKITA Drilling on September 24, 2024 and sell it today you would earn a total of 3.00 from holding AKITA Drilling or generate 1.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AKITA Drilling vs. International Metals Mining
Performance |
| Timeline |
| AKITA Drilling |
| International Metals |
AKITA Drilling and International Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AKITA Drilling and International Metals
The main advantage of trading using opposite AKITA Drilling and International Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AKITA Drilling position performs unexpectedly, International Metals 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 International Metals will offset losses from the drop in International Metals' long position.| AKITA Drilling vs. STEP Energy Services | AKITA Drilling vs. Southern Energy Corp | AKITA Drilling vs. iShares Canadian HYBrid | AKITA Drilling vs. Altagas Cum Red |
| International Metals vs. 2028 Investment Grade | International Metals vs. NeuPath Health | International Metals vs. Constellation Software | International Metals vs. Sparx Technology |
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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