Correlation Between Auctus Alternative and BTC Health
Can any of the company-specific risk be diversified away by investing in both Auctus Alternative and BTC Health 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 Auctus Alternative and BTC Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auctus Alternative Investments and BTC Health Limited, you can compare the effects of market volatilities on Auctus Alternative and BTC Health 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 Auctus Alternative with a short position of BTC Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auctus Alternative and BTC Health.
Diversification Opportunities for Auctus Alternative and BTC Health
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Auctus and BTC is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Auctus Alternative Investments and BTC Health Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTC Health Limited and Auctus Alternative 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 Auctus Alternative Investments are associated (or correlated) with BTC Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTC Health Limited has no effect on the direction of Auctus Alternative i.e., Auctus Alternative and BTC Health go up and down completely randomly.
Pair Corralation between Auctus Alternative and BTC Health
Assuming the 90 days trading horizon Auctus Alternative Investments is expected to under-perform the BTC Health. But the stock apears to be less risky and, when comparing its historical volatility, Auctus Alternative Investments is 1.61 times less risky than BTC Health. The stock trades about -0.02 of its potential returns per unit of risk. The BTC Health Limited is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 4.10 in BTC Health Limited on August 29, 2024 and sell it today you would earn a total of 1.40 from holding BTC Health Limited or generate 34.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auctus Alternative Investments vs. BTC Health Limited
Performance |
| Timeline |
| Auctus Alternative |
| BTC Health Limited |
Auctus Alternative and BTC Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auctus Alternative and BTC Health
The main advantage of trading using opposite Auctus Alternative and BTC Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auctus Alternative position performs unexpectedly, BTC Health 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 BTC Health will offset losses from the drop in BTC Health's long position.| Auctus Alternative vs. Champion Iron | Auctus Alternative vs. Ridley | Auctus Alternative vs. Peel Mining | Auctus Alternative vs. Australian Dairy Farms |
| BTC Health vs. Westpac Banking | BTC Health vs. Champion Iron | BTC Health vs. Ridley | BTC Health vs. Peel 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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