Correlation Between Blue Label and AngloGold Ashanti
Can any of the company-specific risk be diversified away by investing in both Blue Label and AngloGold Ashanti 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 Blue Label and AngloGold Ashanti into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Label Telecoms and AngloGold Ashanti, you can compare the effects of market volatilities on Blue Label and AngloGold Ashanti 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 Blue Label with a short position of AngloGold Ashanti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Label and AngloGold Ashanti.
Diversification Opportunities for Blue Label and AngloGold Ashanti
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Blue and AngloGold is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Blue Label Telecoms and AngloGold Ashanti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AngloGold Ashanti and Blue Label 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 Blue Label Telecoms are associated (or correlated) with AngloGold Ashanti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AngloGold Ashanti has no effect on the direction of Blue Label i.e., Blue Label and AngloGold Ashanti go up and down completely randomly.
Pair Corralation between Blue Label and AngloGold Ashanti
Assuming the 90 days trading horizon Blue Label Telecoms is expected to generate 0.53 times more return on investment than AngloGold Ashanti. However, Blue Label Telecoms is 1.9 times less risky than AngloGold Ashanti. It trades about 0.11 of its potential returns per unit of risk. AngloGold Ashanti is currently generating about 0.04 per unit of risk. If you would invest 51,400 in Blue Label Telecoms on September 5, 2024 and sell it today you would earn a total of 3,100 from holding Blue Label Telecoms or generate 6.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blue Label Telecoms vs. AngloGold Ashanti
Performance |
| Timeline |
| Blue Label Telecoms |
| AngloGold Ashanti |
Blue Label and AngloGold Ashanti Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Label and AngloGold Ashanti
The main advantage of trading using opposite Blue Label and AngloGold Ashanti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Label position performs unexpectedly, AngloGold Ashanti 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 AngloGold Ashanti will offset losses from the drop in AngloGold Ashanti's long position.| Blue Label vs. Brimstone Investment | Blue Label vs. Deneb Investments | Blue Label vs. Afine Investments | Blue Label vs. Kap Industrial Holdings |
| AngloGold Ashanti vs. Frontier Transport Holdings | AngloGold Ashanti vs. Blue Label Telecoms | AngloGold Ashanti vs. RCL Foods | AngloGold Ashanti vs. Advtech |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |