Correlation Between ANTA SPORTS and GOLD ROAD
Can any of the company-specific risk be diversified away by investing in both ANTA SPORTS and GOLD ROAD 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 ANTA SPORTS and GOLD ROAD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANTA SPORTS PRODUCT and GOLD ROAD RES, you can compare the effects of market volatilities on ANTA SPORTS and GOLD ROAD 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 ANTA SPORTS with a short position of GOLD ROAD. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANTA SPORTS and GOLD ROAD.
Diversification Opportunities for ANTA SPORTS and GOLD ROAD
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ANTA and GOLD is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding ANTA SPORTS PRODUCT and GOLD ROAD RES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GOLD ROAD RES and ANTA SPORTS 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 ANTA SPORTS PRODUCT are associated (or correlated) with GOLD ROAD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GOLD ROAD RES has no effect on the direction of ANTA SPORTS i.e., ANTA SPORTS and GOLD ROAD go up and down completely randomly.
Pair Corralation between ANTA SPORTS and GOLD ROAD
Assuming the 90 days trading horizon ANTA SPORTS is expected to generate 1.31 times less return on investment than GOLD ROAD. In addition to that, ANTA SPORTS is 1.78 times more volatile than GOLD ROAD RES. It trades about 0.1 of its total potential returns per unit of risk. GOLD ROAD RES is currently generating about 0.23 per unit of volatility. If you would invest 92.00 in GOLD ROAD RES on September 12, 2024 and sell it today you would earn a total of 38.00 from holding GOLD ROAD RES or generate 41.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANTA SPORTS PRODUCT vs. GOLD ROAD RES
Performance |
| Timeline |
| ANTA SPORTS PRODUCT |
| GOLD ROAD RES |
ANTA SPORTS and GOLD ROAD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANTA SPORTS and GOLD ROAD
The main advantage of trading using opposite ANTA SPORTS and GOLD ROAD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANTA SPORTS position performs unexpectedly, GOLD ROAD 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 GOLD ROAD will offset losses from the drop in GOLD ROAD's long position.| ANTA SPORTS vs. Apple Inc | ANTA SPORTS vs. Apple Inc | ANTA SPORTS vs. Apple Inc | ANTA SPORTS vs. Apple Inc |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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