Correlation Between Aurelia Metals and Canstar Resources
Can any of the company-specific risk be diversified away by investing in both Aurelia Metals and Canstar Resources 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 Aurelia Metals and Canstar Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aurelia Metals Limited and Canstar Resources, you can compare the effects of market volatilities on Aurelia Metals and Canstar Resources 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 Aurelia Metals with a short position of Canstar Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurelia Metals and Canstar Resources.
Diversification Opportunities for Aurelia Metals and Canstar Resources
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aurelia and Canstar is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Aurelia Metals Limited and Canstar Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canstar Resources and Aurelia Metals 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 Aurelia Metals Limited are associated (or correlated) with Canstar Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canstar Resources has no effect on the direction of Aurelia Metals i.e., Aurelia Metals and Canstar Resources go up and down completely randomly.
Pair Corralation between Aurelia Metals and Canstar Resources
If you would invest 2.50 in Canstar Resources on November 2, 2024 and sell it today you would earn a total of 0.50 from holding Canstar Resources or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurelia Metals Limited vs. Canstar Resources
Performance |
| Timeline |
| Aurelia Metals |
| Canstar Resources |
Aurelia Metals and Canstar Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurelia Metals and Canstar Resources
The main advantage of trading using opposite Aurelia Metals and Canstar Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurelia Metals position performs unexpectedly, Canstar Resources 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 Canstar Resources will offset losses from the drop in Canstar Resources' long position.| Aurelia Metals vs. Champion Bear Resources | Aurelia Metals vs. Baroyeca Gold Silver | Aurelia Metals vs. Centaurus Metals Limited | Aurelia Metals vs. Edison Cobalt Corp |
| Canstar Resources vs. Kenorland Minerals | Canstar Resources vs. Prime Mining Corp | Canstar Resources vs. Euro Manganese | Canstar Resources vs. Chalice Mining Limited |
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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