Correlation Between Aurelia Metals and FireFly Metals
Can any of the company-specific risk be diversified away by investing in both Aurelia Metals and FireFly Metals 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 Aurelia Metals and FireFly Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurelia Metals and FireFly Metals, you can compare the effects of market volatilities on Aurelia Metals and FireFly Metals 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 Aurelia Metals with a short position of FireFly Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurelia Metals and FireFly Metals.
Diversification Opportunities for Aurelia Metals and FireFly Metals
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aurelia and FireFly is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Aurelia Metals and FireFly Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FireFly Metals and Aurelia Metals 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 Aurelia Metals are associated (or correlated) with FireFly Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FireFly Metals has no effect on the direction of Aurelia Metals i.e., Aurelia Metals and FireFly Metals go up and down completely randomly.
Pair Corralation between Aurelia Metals and FireFly Metals
Assuming the 90 days trading horizon Aurelia Metals is expected to generate 1.83 times more return on investment than FireFly Metals. However, Aurelia Metals is 1.83 times more volatile than FireFly Metals. It trades about 0.15 of its potential returns per unit of risk. FireFly Metals is currently generating about 0.16 per unit of risk. If you would invest 17.00 in Aurelia Metals on October 21, 2024 and sell it today you would earn a total of 2.00 from holding Aurelia Metals or generate 11.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurelia Metals vs. FireFly Metals
Performance |
| Timeline |
| Aurelia Metals |
| FireFly Metals |
Aurelia Metals and FireFly Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurelia Metals and FireFly Metals
The main advantage of trading using opposite Aurelia Metals and FireFly Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurelia Metals position performs unexpectedly, FireFly Metals 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 FireFly Metals will offset losses from the drop in FireFly Metals' long position.| Aurelia Metals vs. M3 Mining | Aurelia Metals vs. Maggie Beer Holdings | Aurelia Metals vs. MetalsGrove Mining | Aurelia Metals vs. Andean Silver Limited |
| FireFly Metals vs. Iron Road | FireFly Metals vs. Farm Pride Foods | FireFly Metals vs. Charter Hall Retail | FireFly Metals vs. Phoslock Environmental Technologies |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |