Correlation Between Balkan Mining and National Australia
Can any of the company-specific risk be diversified away by investing in both Balkan Mining and National Australia 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 Balkan Mining and National Australia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Balkan Mining and and National Australia Bank, you can compare the effects of market volatilities on Balkan Mining and National Australia 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 Balkan Mining with a short position of National Australia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Balkan Mining and National Australia.
Diversification Opportunities for Balkan Mining and National Australia
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Balkan and National is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Balkan Mining and and National Australia Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Australia Bank and Balkan Mining 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 Balkan Mining and are associated (or correlated) with National Australia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Australia Bank has no effect on the direction of Balkan Mining i.e., Balkan Mining and National Australia go up and down completely randomly.
Pair Corralation between Balkan Mining and National Australia
Assuming the 90 days trading horizon Balkan Mining and is expected to under-perform the National Australia. In addition to that, Balkan Mining is 21.14 times more volatile than National Australia Bank. It trades about -0.04 of its total potential returns per unit of risk. National Australia Bank is currently generating about 0.07 per unit of volatility. If you would invest 9,460 in National Australia Bank on November 2, 2024 and sell it today you would earn a total of 1,010 from holding National Australia Bank or generate 10.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Balkan Mining and vs. National Australia Bank
Performance |
| Timeline |
| Balkan Mining |
| National Australia Bank |
Balkan Mining and National Australia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Balkan Mining and National Australia
The main advantage of trading using opposite Balkan Mining and National Australia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Balkan Mining position performs unexpectedly, National Australia 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 National Australia will offset losses from the drop in National Australia's long position.| Balkan Mining vs. A1 Investments Resources | Balkan Mining vs. Hutchison Telecommunications | Balkan Mining vs. Platinum Asset Management | Balkan Mining vs. Queste Communications |
| National Australia vs. Fisher Paykel Healthcare | National Australia vs. Ambertech | National Australia vs. Sports Entertainment Group | National Australia vs. Event Hospitality and |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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