Correlation Between Altura Mining and Sienna Resources
Can any of the company-specific risk be diversified away by investing in both Altura Mining and Sienna Resources 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 Altura Mining and Sienna Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altura Mining Limited and Sienna Resources, you can compare the effects of market volatilities on Altura Mining and Sienna Resources 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 Altura Mining with a short position of Sienna Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altura Mining and Sienna Resources.
Diversification Opportunities for Altura Mining and Sienna Resources
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Altura and Sienna is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Altura Mining Limited and Sienna Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sienna Resources and Altura Mining 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 Altura Mining Limited are associated (or correlated) with Sienna Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sienna Resources has no effect on the direction of Altura Mining i.e., Altura Mining and Sienna Resources go up and down completely randomly.
Pair Corralation between Altura Mining and Sienna Resources
Assuming the 90 days horizon Altura Mining Limited is expected to generate 11.23 times more return on investment than Sienna Resources. However, Altura Mining is 11.23 times more volatile than Sienna Resources. It trades about 0.1 of its potential returns per unit of risk. Sienna Resources is currently generating about 0.01 per unit of risk. If you would invest 0.30 in Altura Mining Limited on August 26, 2024 and sell it today you would earn a total of 0.22 from holding Altura Mining Limited or generate 73.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altura Mining Limited vs. Sienna Resources
Performance |
| Timeline |
| Altura Mining Limited |
| Sienna Resources |
Altura Mining and Sienna Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altura Mining and Sienna Resources
The main advantage of trading using opposite Altura Mining and Sienna Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altura Mining position performs unexpectedly, Sienna Resources 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 Sienna Resources will offset losses from the drop in Sienna Resources' long position.| Altura Mining vs. Aurelia Metals Limited | Altura Mining vs. Ascendant Resources | Altura Mining vs. Artemis Resources | Altura Mining vs. Azimut Exploration |
| Sienna Resources vs. Ascendant Resources | Sienna Resources vs. Cantex Mine Development | Sienna Resources vs. Amarc Resources | Sienna Resources vs. Sterling Metals Corp |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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