Correlation Between Atalaya Mining and Synthomer Plc
Can any of the company-specific risk be diversified away by investing in both Atalaya Mining and Synthomer Plc 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 Synthomer Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atalaya Mining and Synthomer plc, you can compare the effects of market volatilities on Atalaya Mining and Synthomer Plc 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 Synthomer Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atalaya Mining and Synthomer Plc.
Diversification Opportunities for Atalaya Mining and Synthomer Plc
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Atalaya and Synthomer is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Atalaya Mining and Synthomer plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synthomer 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 Synthomer Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synthomer plc has no effect on the direction of Atalaya Mining i.e., Atalaya Mining and Synthomer Plc go up and down completely randomly.
Pair Corralation between Atalaya Mining and Synthomer Plc
Assuming the 90 days trading horizon Atalaya Mining is expected to generate 0.59 times more return on investment than Synthomer Plc. However, Atalaya Mining is 1.69 times less risky than Synthomer Plc. It trades about 0.03 of its potential returns per unit of risk. Synthomer plc is currently generating about -0.07 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atalaya Mining vs. Synthomer plc
Performance |
| Timeline |
| Atalaya Mining |
| Synthomer plc |
Atalaya Mining and Synthomer Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atalaya Mining and Synthomer Plc
The main advantage of trading using opposite Atalaya Mining and Synthomer Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atalaya Mining position performs unexpectedly, Synthomer Plc 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 Synthomer Plc will offset losses from the drop in Synthomer Plc's long position.| Atalaya Mining vs. Givaudan SA | Atalaya Mining vs. Antofagasta PLC | Atalaya Mining vs. Centamin PLC | Atalaya Mining vs. Amaroq Minerals |
| Synthomer Plc vs. Givaudan SA | Synthomer Plc vs. Antofagasta PLC | Synthomer Plc vs. Centamin PLC | Synthomer Plc 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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