Correlation Between Aurelia Metals and Anglo American
Can any of the company-specific risk be diversified away by investing in both Aurelia Metals 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 Aurelia Metals and Anglo American 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 Anglo American PLC, you can compare the effects of market volatilities on Aurelia Metals 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 Aurelia Metals with a short position of Anglo American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurelia Metals and Anglo American.
Diversification Opportunities for Aurelia Metals and Anglo American
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aurelia and Anglo is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Aurelia Metals Limited 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 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 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 Aurelia Metals i.e., Aurelia Metals and Anglo American go up and down completely randomly.
Pair Corralation between Aurelia Metals and Anglo American
Assuming the 90 days horizon Aurelia Metals Limited is expected to under-perform the Anglo American. In addition to that, Aurelia Metals is 1.45 times more volatile than Anglo American PLC. It trades about -0.21 of its total potential returns per unit of risk. Anglo American PLC is currently generating about -0.09 per unit of volatility. If you would invest 1,603 in Anglo American PLC on August 29, 2024 and sell it today you would lose (87.00) from holding Anglo American PLC or give up 5.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurelia Metals Limited vs. Anglo American PLC
Performance |
| Timeline |
| Aurelia Metals |
| Anglo American PLC |
Aurelia Metals and Anglo American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurelia Metals and Anglo American
The main advantage of trading using opposite Aurelia Metals and Anglo American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurelia Metals 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.| Aurelia Metals vs. Rockridge Resources | Aurelia Metals vs. Ameriwest Lithium | Aurelia Metals vs. Osisko Metals Incorporated | Aurelia Metals vs. Volt Lithium Corp |
| Anglo American vs. BHP Group Limited | Anglo American vs. Avarone Metals | Anglo American vs. Huntsman Exploration | Anglo American vs. Aurelia Metals 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |