Correlation Between Atalaya Mining and Anglo American
Can any of the company-specific risk be diversified away by investing in both Atalaya Mining 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 Atalaya Mining and Anglo American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atalaya Mining and Anglo American PLC, you can compare the effects of market volatilities on Atalaya Mining 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 Atalaya Mining with a short position of Anglo American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atalaya Mining and Anglo American.
Diversification Opportunities for Atalaya Mining and Anglo American
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Atalaya and Anglo is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Atalaya Mining and Anglo American PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anglo American PLC and Atalaya Mining 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 Atalaya Mining 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 PLC has no effect on the direction of Atalaya Mining i.e., Atalaya Mining and Anglo American go up and down completely randomly.
Pair Corralation between Atalaya Mining and Anglo American
Assuming the 90 days trading horizon Atalaya Mining is expected to generate 0.94 times more return on investment than Anglo American. However, Atalaya Mining is 1.07 times less risky than Anglo American. It trades about 0.03 of its potential returns per unit of risk. Anglo American PLC is currently generating about -0.02 per unit of risk. If you would invest 29,018 in Atalaya Mining on August 26, 2024 and sell it today you would earn a total of 5,882 from holding Atalaya Mining or generate 20.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atalaya Mining vs. Anglo American PLC
Performance |
| Timeline |
| Atalaya Mining |
| Anglo American PLC |
Atalaya Mining and Anglo American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atalaya Mining and Anglo American
The main advantage of trading using opposite Atalaya Mining and Anglo American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atalaya Mining 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.| Atalaya Mining vs. Givaudan SA | Atalaya Mining vs. Antofagasta PLC | Atalaya Mining vs. Centamin PLC | Atalaya Mining vs. Amaroq Minerals |
| Anglo American vs. Givaudan SA | Anglo American vs. Antofagasta PLC | Anglo American vs. Centamin PLC | Anglo American vs. Atalaya 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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