Correlation Between Arctic Gold and AAC Clyde
Can any of the company-specific risk be diversified away by investing in both Arctic Gold and AAC Clyde 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 Arctic Gold and AAC Clyde into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arctic Gold Publ and AAC Clyde Space, you can compare the effects of market volatilities on Arctic Gold and AAC Clyde 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 Arctic Gold with a short position of AAC Clyde. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arctic Gold and AAC Clyde.
Diversification Opportunities for Arctic Gold and AAC Clyde
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Arctic and AAC is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Arctic Gold Publ and AAC Clyde Space in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AAC Clyde Space and Arctic Gold 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 Arctic Gold Publ are associated (or correlated) with AAC Clyde. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AAC Clyde Space has no effect on the direction of Arctic Gold i.e., Arctic Gold and AAC Clyde go up and down completely randomly.
Pair Corralation between Arctic Gold and AAC Clyde
Assuming the 90 days trading horizon Arctic Gold is expected to generate 60.82 times less return on investment than AAC Clyde. But when comparing it to its historical volatility, Arctic Gold Publ is 8.0 times less risky than AAC Clyde. It trades about 0.01 of its potential returns per unit of risk. AAC Clyde Space is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 154.00 in AAC Clyde Space on August 26, 2024 and sell it today you would earn a total of 4,451 from holding AAC Clyde Space or generate 2890.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arctic Gold Publ vs. AAC Clyde Space
Performance |
| Timeline |
| Arctic Gold Publ |
| AAC Clyde Space |
Arctic Gold and AAC Clyde Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arctic Gold and AAC Clyde
The main advantage of trading using opposite Arctic Gold and AAC Clyde positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arctic Gold position performs unexpectedly, AAC Clyde 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 AAC Clyde will offset losses from the drop in AAC Clyde's long position.| Arctic Gold vs. Svenska Aerogel Holding | Arctic Gold vs. Kancera AB | Arctic Gold vs. BIMobject AB | Arctic Gold vs. KABE Group AB |
| AAC Clyde vs. aXichem AB | AAC Clyde vs. Gaming Corps AB | AAC Clyde vs. Cantargia AB | AAC Clyde vs. KABE Group AB |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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