Correlation Between Alliance Resource and AIM Energy
Can any of the company-specific risk be diversified away by investing in both Alliance Resource and AIM Energy 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 Alliance Resource and AIM Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alliance Resource Partners and AIM Energy, you can compare the effects of market volatilities on Alliance Resource and AIM Energy 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 Alliance Resource with a short position of AIM Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliance Resource and AIM Energy.
Diversification Opportunities for Alliance Resource and AIM Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alliance and AIM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Alliance Resource Partners and AIM Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIM Energy and Alliance Resource 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 Alliance Resource Partners are associated (or correlated) with AIM Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIM Energy has no effect on the direction of Alliance Resource i.e., Alliance Resource and AIM Energy go up and down completely randomly.
Pair Corralation between Alliance Resource and AIM Energy
If you would invest 2,579 in Alliance Resource Partners on September 4, 2024 and sell it today you would earn a total of 201.00 from holding Alliance Resource Partners or generate 7.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Alliance Resource Partners vs. AIM Energy
Performance |
| Timeline |
| Alliance Resource |
| AIM Energy |
Alliance Resource and AIM Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alliance Resource and AIM Energy
The main advantage of trading using opposite Alliance Resource and AIM Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliance Resource position performs unexpectedly, AIM Energy 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 AIM Energy will offset losses from the drop in AIM Energy's long position.| Alliance Resource vs. Peabody Energy Corp | Alliance Resource vs. Natural Resource Partners | Alliance Resource vs. Hallador Energy | Alliance Resource vs. NACCO Industries |
| AIM Energy vs. Adaro Energy Tbk | AIM Energy vs. Alliance Resource Partners | AIM Energy vs. Indo Tambangraya Megah | AIM Energy vs. Yanzhou Coal 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |