Correlation Between Artemis Resources and Altura Mining
Can any of the company-specific risk be diversified away by investing in both Artemis Resources and Altura Mining 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 Artemis Resources and Altura Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artemis Resources and Altura Mining Limited, you can compare the effects of market volatilities on Artemis Resources and Altura Mining 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 Artemis Resources with a short position of Altura Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artemis Resources and Altura Mining.
Diversification Opportunities for Artemis Resources and Altura Mining
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Artemis and Altura is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Artemis Resources and Altura Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altura Mining Limited and Artemis Resources 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 Artemis Resources are associated (or correlated) with Altura Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altura Mining Limited has no effect on the direction of Artemis Resources i.e., Artemis Resources and Altura Mining go up and down completely randomly.
Pair Corralation between Artemis Resources and Altura Mining
Assuming the 90 days horizon Artemis Resources is expected to generate 3.29 times less return on investment than Altura Mining. But when comparing it to its historical volatility, Artemis Resources is 2.99 times less risky than Altura Mining. It trades about 0.09 of its potential returns per unit of risk. Altura Mining Limited is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1.51 in Altura Mining Limited on August 29, 2024 and sell it today you would lose (0.99) from holding Altura Mining Limited or give up 65.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Artemis Resources vs. Altura Mining Limited
Performance |
| Timeline |
| Artemis Resources |
| Altura Mining Limited |
Artemis Resources and Altura Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artemis Resources and Altura Mining
The main advantage of trading using opposite Artemis Resources and Altura Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artemis Resources position performs unexpectedly, Altura Mining 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 Altura Mining will offset losses from the drop in Altura Mining's long position.The idea behind Artemis Resources and Altura Mining Limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Altura Mining vs. Aurelia Metals Limited | Altura Mining vs. Ascendant Resources | Altura Mining vs. Artemis Resources | Altura Mining vs. Azimut Exploration |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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