Correlation Between Black Rock and Astral Resources
Can any of the company-specific risk be diversified away by investing in both Black Rock and Astral Resources 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 Black Rock and Astral Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Black Rock Mining and Astral Resources NL, you can compare the effects of market volatilities on Black Rock and Astral Resources 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 Black Rock with a short position of Astral Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Black Rock and Astral Resources.
Diversification Opportunities for Black Rock and Astral Resources
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Black and Astral is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Black Rock Mining and Astral Resources NL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astral Resources and Black Rock 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 Black Rock Mining are associated (or correlated) with Astral Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astral Resources has no effect on the direction of Black Rock i.e., Black Rock and Astral Resources go up and down completely randomly.
Pair Corralation between Black Rock and Astral Resources
Assuming the 90 days trading horizon Black Rock Mining is expected to generate 1.09 times more return on investment than Astral Resources. However, Black Rock is 1.09 times more volatile than Astral Resources NL. It trades about 0.06 of its potential returns per unit of risk. Astral Resources NL is currently generating about -0.11 per unit of risk. If you would invest 3.50 in Black Rock Mining on October 22, 2024 and sell it today you would earn a total of 0.10 from holding Black Rock Mining or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Black Rock Mining vs. Astral Resources NL
Performance |
| Timeline |
| Black Rock Mining |
| Astral Resources |
Black Rock and Astral Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Black Rock and Astral Resources
The main advantage of trading using opposite Black Rock and Astral Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Black Rock position performs unexpectedly, Astral Resources 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 Astral Resources will offset losses from the drop in Astral Resources' long position.| Black Rock vs. Gold Road Resources | Black Rock vs. Treasury Wine Estates | Black Rock vs. Kip McGrath Education | Black Rock vs. G8 Education |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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