Correlation Between BTC Health and Ampol
Can any of the company-specific risk be diversified away by investing in both BTC Health and Ampol 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 BTC Health and Ampol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BTC Health Limited and Ampol, you can compare the effects of market volatilities on BTC Health and Ampol 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 BTC Health with a short position of Ampol. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTC Health and Ampol.
Diversification Opportunities for BTC Health and Ampol
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BTC and Ampol is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding BTC Health Limited and Ampol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ampol and BTC Health 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 BTC Health Limited are associated (or correlated) with Ampol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ampol has no effect on the direction of BTC Health i.e., BTC Health and Ampol go up and down completely randomly.
Pair Corralation between BTC Health and Ampol
Assuming the 90 days trading horizon BTC Health Limited is expected to generate 3.7 times more return on investment than Ampol. However, BTC Health is 3.7 times more volatile than Ampol. It trades about 0.03 of its potential returns per unit of risk. Ampol is currently generating about -0.04 per unit of risk. If you would invest 5.80 in BTC Health Limited on September 14, 2024 and sell it today you would earn a total of 0.90 from holding BTC Health Limited or generate 15.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTC Health Limited vs. Ampol
Performance |
| Timeline |
| BTC Health Limited |
| Ampol |
BTC Health and Ampol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTC Health and Ampol
The main advantage of trading using opposite BTC Health and Ampol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTC Health position performs unexpectedly, Ampol 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 Ampol will offset losses from the drop in Ampol's long position.| BTC Health vs. Talisman Mining | BTC Health vs. Red Hill Iron | BTC Health vs. M3 Mining | BTC Health vs. Chalice Mining Limited |
| Ampol vs. BTC Health Limited | Ampol vs. Falcon Metals | Ampol vs. Dalaroo Metals | Ampol 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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