Correlation Between ANZ Group and Stelar Metals
Can any of the company-specific risk be diversified away by investing in both ANZ Group and Stelar 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 ANZ Group and Stelar Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANZ Group Holdings and Stelar Metals, you can compare the effects of market volatilities on ANZ Group and Stelar 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 ANZ Group with a short position of Stelar Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANZ Group and Stelar Metals.
Diversification Opportunities for ANZ Group and Stelar Metals
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ANZ and Stelar is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding ANZ Group Holdings and Stelar Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stelar Metals and ANZ Group 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 ANZ Group Holdings are associated (or correlated) with Stelar Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stelar Metals has no effect on the direction of ANZ Group i.e., ANZ Group and Stelar Metals go up and down completely randomly.
Pair Corralation between ANZ Group and Stelar Metals
Assuming the 90 days trading horizon ANZ Group Holdings is expected to generate 0.05 times more return on investment than Stelar Metals. However, ANZ Group Holdings is 18.92 times less risky than Stelar Metals. It trades about 0.05 of its potential returns per unit of risk. Stelar Metals is currently generating about 0.0 per unit of risk. If you would invest 9,573 in ANZ Group Holdings on September 4, 2024 and sell it today you would earn a total of 758.00 from holding ANZ Group Holdings or generate 7.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
ANZ Group Holdings vs. Stelar Metals
Performance |
| Timeline |
| ANZ Group Holdings |
| Stelar Metals |
ANZ Group and Stelar Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANZ Group and Stelar Metals
The main advantage of trading using opposite ANZ Group and Stelar Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANZ Group position performs unexpectedly, Stelar 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 Stelar Metals will offset losses from the drop in Stelar Metals' long position.| ANZ Group vs. Cleanaway Waste Management | ANZ Group vs. Super Retail Group | ANZ Group vs. Nine Entertainment Co | ANZ Group vs. Dexus Convenience Retail |
| Stelar Metals vs. Northern Star Resources | Stelar Metals vs. Evolution Mining | Stelar Metals vs. Bluescope Steel | Stelar Metals vs. Sandfire Resources NL |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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