Correlation Between Altagas Cum and Eastern Platinum
Can any of the company-specific risk be diversified away by investing in both Altagas Cum and Eastern Platinum 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 Altagas Cum and Eastern Platinum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altagas Cum Red and Eastern Platinum Limited, you can compare the effects of market volatilities on Altagas Cum and Eastern Platinum 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 Altagas Cum with a short position of Eastern Platinum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altagas Cum and Eastern Platinum.
Diversification Opportunities for Altagas Cum and Eastern Platinum
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Altagas and Eastern is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Altagas Cum Red and Eastern Platinum Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern Platinum and Altagas Cum 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 Altagas Cum Red are associated (or correlated) with Eastern Platinum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Platinum has no effect on the direction of Altagas Cum i.e., Altagas Cum and Eastern Platinum go up and down completely randomly.
Pair Corralation between Altagas Cum and Eastern Platinum
Assuming the 90 days trading horizon Altagas Cum is expected to generate 7.57 times less return on investment than Eastern Platinum. But when comparing it to its historical volatility, Altagas Cum Red is 7.97 times less risky than Eastern Platinum. It trades about 0.07 of its potential returns per unit of risk. Eastern Platinum Limited is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Eastern Platinum Limited on September 1, 2024 and sell it today you would earn a total of 7.00 from holding Eastern Platinum Limited or generate 63.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altagas Cum Red vs. Eastern Platinum Limited
Performance |
| Timeline |
| Altagas Cum Red |
| Eastern Platinum |
Altagas Cum and Eastern Platinum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altagas Cum and Eastern Platinum
The main advantage of trading using opposite Altagas Cum and Eastern Platinum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altagas Cum position performs unexpectedly, Eastern Platinum 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 Eastern Platinum will offset losses from the drop in Eastern Platinum's long position.| Altagas Cum vs. Data Communications Management | Altagas Cum vs. Rubicon Organics | Altagas Cum vs. Enerev5 Metals | Altagas Cum vs. MTY Food Group |
| Eastern Platinum vs. Platinum Group Metals | Eastern Platinum vs. Entree Resources | Eastern Platinum vs. Aura Minerals | Eastern Platinum vs. Minco Silver |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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