Correlation Between AstraZeneca PLC and Eastinco Mining
Can any of the company-specific risk be diversified away by investing in both AstraZeneca PLC and Eastinco 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 AstraZeneca PLC and Eastinco Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AstraZeneca PLC and Eastinco Mining Exploration, you can compare the effects of market volatilities on AstraZeneca PLC and Eastinco 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 AstraZeneca PLC with a short position of Eastinco Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of AstraZeneca PLC and Eastinco Mining.
Diversification Opportunities for AstraZeneca PLC and Eastinco Mining
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between AstraZeneca and Eastinco is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding AstraZeneca PLC and Eastinco Mining Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastinco Mining Expl and AstraZeneca PLC 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 AstraZeneca PLC are associated (or correlated) with Eastinco Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastinco Mining Expl has no effect on the direction of AstraZeneca PLC i.e., AstraZeneca PLC and Eastinco Mining go up and down completely randomly.
Pair Corralation between AstraZeneca PLC and Eastinco Mining
Assuming the 90 days trading horizon AstraZeneca PLC is expected to generate 3.1 times less return on investment than Eastinco Mining. But when comparing it to its historical volatility, AstraZeneca PLC is 2.39 times less risky than Eastinco Mining. It trades about 0.26 of its potential returns per unit of risk. Eastinco Mining Exploration is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 4,550 in Eastinco Mining Exploration on October 25, 2024 and sell it today you would earn a total of 850.00 from holding Eastinco Mining Exploration or generate 18.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AstraZeneca PLC vs. Eastinco Mining Exploration
Performance |
| Timeline |
| AstraZeneca PLC |
| Eastinco Mining Expl |
AstraZeneca PLC and Eastinco Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AstraZeneca PLC and Eastinco Mining
The main advantage of trading using opposite AstraZeneca PLC and Eastinco Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AstraZeneca PLC position performs unexpectedly, Eastinco 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 Eastinco Mining will offset losses from the drop in Eastinco Mining's long position.| AstraZeneca PLC vs. Eastinco Mining Exploration | AstraZeneca PLC vs. Coeur Mining | AstraZeneca PLC vs. iShares Physical Silver | AstraZeneca PLC vs. AfriTin Mining |
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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