Correlation Between Aldel Financial and East Africa
Can any of the company-specific risk be diversified away by investing in both Aldel Financial and East Africa 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 Aldel Financial and East Africa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aldel Financial II and East Africa Metals, you can compare the effects of market volatilities on Aldel Financial and East Africa 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 Aldel Financial with a short position of East Africa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aldel Financial and East Africa.
Diversification Opportunities for Aldel Financial and East Africa
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aldel and East is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aldel Financial II and East Africa Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East Africa Metals and Aldel Financial 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 Aldel Financial II are associated (or correlated) with East Africa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East Africa Metals has no effect on the direction of Aldel Financial i.e., Aldel Financial and East Africa go up and down completely randomly.
Pair Corralation between Aldel Financial and East Africa
Given the investment horizon of 90 days Aldel Financial II is expected to generate 0.03 times more return on investment than East Africa. However, Aldel Financial II is 29.53 times less risky than East Africa. It trades about 0.29 of its potential returns per unit of risk. East Africa Metals is currently generating about -0.12 per unit of risk. If you would invest 990.00 in Aldel Financial II on October 26, 2024 and sell it today you would earn a total of 8.00 from holding Aldel Financial II or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 20.47% |
| Values | Daily Returns |
Aldel Financial II vs. East Africa Metals
Performance |
| Timeline |
| Aldel Financial II |
| East Africa Metals |
Aldel Financial and East Africa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aldel Financial and East Africa
The main advantage of trading using opposite Aldel Financial and East Africa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aldel Financial position performs unexpectedly, East Africa 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 East Africa will offset losses from the drop in East Africa's long position.| Aldel Financial vs. Voyager Acquisition Corp | Aldel Financial vs. dMY Squared Technology | Aldel Financial vs. YHN Acquisition I | Aldel Financial vs. YHN Acquisition I |
| East Africa vs. Pasinex Resources Limited | East Africa vs. Commander Resources | East Africa vs. Forsys Metals Corp | East Africa vs. American CuMo Mining |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |