Correlation Between Aurelia Metals and New Age
Can any of the company-specific risk be diversified away by investing in both Aurelia Metals and New Age 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 New Age 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 New Age Metals, you can compare the effects of market volatilities on Aurelia Metals and New Age 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 New Age. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurelia Metals and New Age.
Diversification Opportunities for Aurelia Metals and New Age
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aurelia and New is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Aurelia Metals Limited and New Age Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Age Metals 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 New Age. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Age Metals has no effect on the direction of Aurelia Metals i.e., Aurelia Metals and New Age go up and down completely randomly.
Pair Corralation between Aurelia Metals and New Age
Assuming the 90 days horizon Aurelia Metals is expected to generate 2.86 times less return on investment than New Age. But when comparing it to its historical volatility, Aurelia Metals Limited is 2.74 times less risky than New Age. It trades about 0.09 of its potential returns per unit of risk. New Age Metals is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 3.08 in New Age Metals on August 26, 2024 and sell it today you would earn a total of 3.82 from holding New Age Metals or generate 124.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aurelia Metals Limited vs. New Age Metals
Performance |
| Timeline |
| Aurelia Metals |
| New Age Metals |
Aurelia Metals and New Age Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurelia Metals and New Age
The main advantage of trading using opposite Aurelia Metals and New Age positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurelia Metals position performs unexpectedly, New Age 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 New Age will offset losses from the drop in New Age'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 |
| New Age vs. Vision Lithium | New Age vs. Group Ten Metals | New Age vs. Generation Mining Limited | New Age vs. Nickel Creek Platinum |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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