Correlation Between Aeon Metals and Cosmo Metals
Can any of the company-specific risk be diversified away by investing in both Aeon Metals and Cosmo 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 Aeon Metals and Cosmo Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aeon Metals and Cosmo Metals, you can compare the effects of market volatilities on Aeon Metals and Cosmo 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 Aeon Metals with a short position of Cosmo Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aeon Metals and Cosmo Metals.
Diversification Opportunities for Aeon Metals and Cosmo Metals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aeon and Cosmo is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aeon Metals and Cosmo Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cosmo Metals and Aeon 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 Aeon Metals are associated (or correlated) with Cosmo Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cosmo Metals has no effect on the direction of Aeon Metals i.e., Aeon Metals and Cosmo Metals go up and down completely randomly.
Pair Corralation between Aeon Metals and Cosmo Metals
Assuming the 90 days trading horizon Aeon Metals is expected to generate 1.4 times more return on investment than Cosmo Metals. However, Aeon Metals is 1.4 times more volatile than Cosmo Metals. It trades about -0.01 of its potential returns per unit of risk. Cosmo Metals is currently generating about -0.05 per unit of risk. If you would invest 2.90 in Aeon Metals on October 11, 2024 and sell it today you would lose (2.40) from holding Aeon Metals or give up 82.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Aeon Metals vs. Cosmo Metals
Performance |
| Timeline |
| Aeon Metals |
| Cosmo Metals |
Aeon Metals and Cosmo Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aeon Metals and Cosmo Metals
The main advantage of trading using opposite Aeon Metals and Cosmo Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aeon Metals position performs unexpectedly, Cosmo 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 Cosmo Metals will offset losses from the drop in Cosmo Metals' long position.| Aeon Metals vs. Rand Mining | Aeon Metals vs. Black Rock Mining | Aeon Metals vs. Perseus Mining | Aeon Metals vs. MetalsGrove Mining |
| Cosmo Metals vs. Metro Mining | Cosmo Metals vs. Auswide Bank | Cosmo Metals vs. Sequoia Financial Group | Cosmo Metals vs. Aspire 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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