Correlation Between Altagas Cum and Lucara Diamond
Can any of the company-specific risk be diversified away by investing in both Altagas Cum and Lucara Diamond 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 Lucara Diamond 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 Lucara Diamond Corp, you can compare the effects of market volatilities on Altagas Cum and Lucara Diamond 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 Lucara Diamond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altagas Cum and Lucara Diamond.
Diversification Opportunities for Altagas Cum and Lucara Diamond
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Altagas and Lucara is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Altagas Cum Red and Lucara Diamond Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lucara Diamond Corp 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 Lucara Diamond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lucara Diamond Corp has no effect on the direction of Altagas Cum i.e., Altagas Cum and Lucara Diamond go up and down completely randomly.
Pair Corralation between Altagas Cum and Lucara Diamond
Assuming the 90 days trading horizon Altagas Cum Red is expected to generate 0.2 times more return on investment than Lucara Diamond. However, Altagas Cum Red is 5.04 times less risky than Lucara Diamond. It trades about 0.16 of its potential returns per unit of risk. Lucara Diamond Corp is currently generating about -0.19 per unit of risk. If you would invest 2,055 in Altagas Cum Red on November 8, 2024 and sell it today you would earn a total of 70.00 from holding Altagas Cum Red or generate 3.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Altagas Cum Red vs. Lucara Diamond Corp
Performance |
| Timeline |
| Altagas Cum Red |
| Lucara Diamond Corp |
Altagas Cum and Lucara Diamond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altagas Cum and Lucara Diamond
The main advantage of trading using opposite Altagas Cum and Lucara Diamond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altagas Cum position performs unexpectedly, Lucara Diamond 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 Lucara Diamond will offset losses from the drop in Lucara Diamond's long position.| Altagas Cum vs. Magna Mining | Altagas Cum vs. Dream Office Real | Altagas Cum vs. MAG Silver Corp | Altagas Cum vs. Mako Mining Corp |
| Lucara Diamond vs. Mountain Province Diamonds | Lucara Diamond vs. Lundin Gold | Lucara Diamond vs. North Arrow Minerals | Lucara Diamond vs. Osisko Gold Ro |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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