Correlation Between Antero Midstream and Braskem SA
Can any of the company-specific risk be diversified away by investing in both Antero Midstream and Braskem SA 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 Antero Midstream and Braskem SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Antero Midstream Partners and Braskem SA Class, you can compare the effects of market volatilities on Antero Midstream and Braskem SA 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 Antero Midstream with a short position of Braskem SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Antero Midstream and Braskem SA.
Diversification Opportunities for Antero Midstream and Braskem SA
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Antero and Braskem is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Antero Midstream Partners and Braskem SA Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Braskem SA Class and Antero Midstream 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 Antero Midstream Partners are associated (or correlated) with Braskem SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Braskem SA Class has no effect on the direction of Antero Midstream i.e., Antero Midstream and Braskem SA go up and down completely randomly.
Pair Corralation between Antero Midstream and Braskem SA
Allowing for the 90-day total investment horizon Antero Midstream Partners is expected to generate 0.4 times more return on investment than Braskem SA. However, Antero Midstream Partners is 2.49 times less risky than Braskem SA. It trades about 0.11 of its potential returns per unit of risk. Braskem SA Class is currently generating about -0.05 per unit of risk. If you would invest 989.00 in Antero Midstream Partners on August 31, 2024 and sell it today you would earn a total of 608.00 from holding Antero Midstream Partners or generate 61.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Antero Midstream Partners vs. Braskem SA Class
Performance |
| Timeline |
| Antero Midstream Partners |
| Braskem SA Class |
Antero Midstream and Braskem SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Antero Midstream and Braskem SA
The main advantage of trading using opposite Antero Midstream and Braskem SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Antero Midstream position performs unexpectedly, Braskem SA 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 Braskem SA will offset losses from the drop in Braskem SA's long position.| Antero Midstream vs. EnLink Midstream LLC | Antero Midstream vs. Western Midstream Partners | Antero Midstream vs. Plains GP Holdings | Antero Midstream vs. Plains All American |
| Braskem SA vs. Huntsman | Braskem SA vs. AdvanSix | Braskem SA vs. Tronox Holdings PLC | Braskem SA vs. Celanese |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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