Correlation Between Aurelia Metals and Fathom Nickel
Can any of the company-specific risk be diversified away by investing in both Aurelia Metals and Fathom Nickel 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 Fathom Nickel 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 Fathom Nickel, you can compare the effects of market volatilities on Aurelia Metals and Fathom Nickel 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 Fathom Nickel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurelia Metals and Fathom Nickel.
Diversification Opportunities for Aurelia Metals and Fathom Nickel
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aurelia and Fathom is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Aurelia Metals Limited and Fathom Nickel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fathom Nickel 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 Fathom Nickel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fathom Nickel has no effect on the direction of Aurelia Metals i.e., Aurelia Metals and Fathom Nickel go up and down completely randomly.
Pair Corralation between Aurelia Metals and Fathom Nickel
Assuming the 90 days horizon Aurelia Metals Limited is expected to generate 1.27 times more return on investment than Fathom Nickel. However, Aurelia Metals is 1.27 times more volatile than Fathom Nickel. It trades about 0.15 of its potential returns per unit of risk. Fathom Nickel is currently generating about 0.02 per unit of risk. If you would invest 7.04 in Aurelia Metals Limited on November 2, 2024 and sell it today you would earn a total of 4.96 from holding Aurelia Metals Limited or generate 70.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 93.02% |
| Values | Daily Returns |
Aurelia Metals Limited vs. Fathom Nickel
Performance |
| Timeline |
| Aurelia Metals |
| Fathom Nickel |
Aurelia Metals and Fathom Nickel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurelia Metals and Fathom Nickel
The main advantage of trading using opposite Aurelia Metals and Fathom Nickel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurelia Metals position performs unexpectedly, Fathom Nickel 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 Fathom Nickel will offset losses from the drop in Fathom Nickel's 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 |
| Fathom Nickel vs. Hannan Metals | Fathom Nickel vs. Atco Mining | Fathom Nickel vs. Leading Edge Materials | Fathom Nickel vs. Arianne Phosphate |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |