Correlation Between Ascendis Health and Anglo American
Can any of the company-specific risk be diversified away by investing in both Ascendis Health and Anglo American 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 Ascendis Health and Anglo American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ascendis Health and Anglo American Platinum, you can compare the effects of market volatilities on Ascendis Health and Anglo American 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 Ascendis Health with a short position of Anglo American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ascendis Health and Anglo American.
Diversification Opportunities for Ascendis Health and Anglo American
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ascendis and Anglo is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Ascendis Health and Anglo American Platinum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anglo American Platinum and Ascendis Health 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 Ascendis Health are associated (or correlated) with Anglo American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anglo American Platinum has no effect on the direction of Ascendis Health i.e., Ascendis Health and Anglo American go up and down completely randomly.
Pair Corralation between Ascendis Health and Anglo American
Assuming the 90 days trading horizon Ascendis Health is expected to generate 0.9 times more return on investment than Anglo American. However, Ascendis Health is 1.11 times less risky than Anglo American. It trades about 0.02 of its potential returns per unit of risk. Anglo American Platinum is currently generating about -0.04 per unit of risk. If you would invest 6,500 in Ascendis Health on August 28, 2024 and sell it today you would earn a total of 1,000.00 from holding Ascendis Health or generate 15.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ascendis Health vs. Anglo American Platinum
Performance |
| Timeline |
| Ascendis Health |
| Anglo American Platinum |
Ascendis Health and Anglo American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ascendis Health and Anglo American
The main advantage of trading using opposite Ascendis Health and Anglo American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ascendis Health position performs unexpectedly, Anglo American 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 Anglo American will offset losses from the drop in Anglo American's long position.| Ascendis Health vs. Deneb Investments | Ascendis Health vs. HomeChoice Investments | Ascendis Health vs. E Media Holdings | Ascendis Health vs. Zeder Investments |
| Anglo American vs. CA Sales Holdings | Anglo American vs. Life Healthcare | Anglo American vs. Afine Investments | Anglo American vs. E Media Holdings |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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