Correlation Between Aurelia Metals and O3 Mining
Can any of the company-specific risk be diversified away by investing in both Aurelia Metals and O3 Mining 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 O3 Mining 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 O3 Mining, you can compare the effects of market volatilities on Aurelia Metals and O3 Mining 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 O3 Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aurelia Metals and O3 Mining.
Diversification Opportunities for Aurelia Metals and O3 Mining
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aurelia and OIIIF is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Aurelia Metals Limited and O3 Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on O3 Mining 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 O3 Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of O3 Mining has no effect on the direction of Aurelia Metals i.e., Aurelia Metals and O3 Mining go up and down completely randomly.
Pair Corralation between Aurelia Metals and O3 Mining
Assuming the 90 days horizon Aurelia Metals is expected to generate 2.96 times less return on investment than O3 Mining. In addition to that, Aurelia Metals is 1.64 times more volatile than O3 Mining. It trades about 0.03 of its total potential returns per unit of risk. O3 Mining is currently generating about 0.14 per unit of volatility. If you would invest 79.00 in O3 Mining on October 20, 2024 and sell it today you would earn a total of 36.00 from holding O3 Mining or generate 45.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.18% |
| Values | Daily Returns |
Aurelia Metals Limited vs. O3 Mining
Performance |
| Timeline |
| Aurelia Metals |
| O3 Mining |
Aurelia Metals and O3 Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aurelia Metals and O3 Mining
The main advantage of trading using opposite Aurelia Metals and O3 Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aurelia Metals position performs unexpectedly, O3 Mining 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 O3 Mining will offset losses from the drop in O3 Mining'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 |
| O3 Mining vs. Canstar Resources | O3 Mining vs. Benton Resources | O3 Mining vs. Prime Mining Corp | O3 Mining vs. Silver X 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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