Correlation Between Batm Advanced and AfriTin Mining
Can any of the company-specific risk be diversified away by investing in both Batm Advanced and AfriTin 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 Batm Advanced and AfriTin Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Batm Advanced Communications and AfriTin Mining, you can compare the effects of market volatilities on Batm Advanced and AfriTin 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 Batm Advanced with a short position of AfriTin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Batm Advanced and AfriTin Mining.
Diversification Opportunities for Batm Advanced and AfriTin Mining
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Batm and AfriTin is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Batm Advanced Communications and AfriTin Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AfriTin Mining and Batm Advanced 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 Batm Advanced Communications are associated (or correlated) with AfriTin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AfriTin Mining has no effect on the direction of Batm Advanced i.e., Batm Advanced and AfriTin Mining go up and down completely randomly.
Pair Corralation between Batm Advanced and AfriTin Mining
Assuming the 90 days trading horizon Batm Advanced Communications is expected to generate 0.67 times more return on investment than AfriTin Mining. However, Batm Advanced Communications is 1.5 times less risky than AfriTin Mining. It trades about 0.01 of its potential returns per unit of risk. AfriTin Mining is currently generating about -0.01 per unit of risk. If you would invest 1,930 in Batm Advanced Communications on September 24, 2024 and sell it today you would lose (10.00) from holding Batm Advanced Communications or give up 0.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Batm Advanced Communications vs. AfriTin Mining
Performance |
| Timeline |
| Batm Advanced Commun |
| AfriTin Mining |
Batm Advanced and AfriTin Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Batm Advanced and AfriTin Mining
The main advantage of trading using opposite Batm Advanced and AfriTin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Batm Advanced position performs unexpectedly, AfriTin 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 AfriTin Mining will offset losses from the drop in AfriTin Mining's long position.| Batm Advanced vs. Endeavour Mining Corp | Batm Advanced vs. GoldMining | Batm Advanced vs. Silvercorp Metals | Batm Advanced vs. Jacquet Metal Service |
| AfriTin Mining vs. United Internet AG | AfriTin Mining vs. BW Offshore | AfriTin Mining vs. Batm Advanced Communications | AfriTin Mining vs. Air Products Chemicals |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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