Correlation Between Central Asia and Ignitis Grupe
Can any of the company-specific risk be diversified away by investing in both Central Asia and Ignitis Grupe 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 Central Asia and Ignitis Grupe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Central Asia Metals and Ignitis Grupe AB, you can compare the effects of market volatilities on Central Asia and Ignitis Grupe 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 Central Asia with a short position of Ignitis Grupe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Asia and Ignitis Grupe.
Diversification Opportunities for Central Asia and Ignitis Grupe
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Central and Ignitis is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Central Asia Metals and Ignitis Grupe AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ignitis Grupe AB and Central Asia 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 Central Asia Metals are associated (or correlated) with Ignitis Grupe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ignitis Grupe AB has no effect on the direction of Central Asia i.e., Central Asia and Ignitis Grupe go up and down completely randomly.
Pair Corralation between Central Asia and Ignitis Grupe
Assuming the 90 days trading horizon Central Asia Metals is expected to under-perform the Ignitis Grupe. But the stock apears to be less risky and, when comparing its historical volatility, Central Asia Metals is 1.06 times less risky than Ignitis Grupe. The stock trades about -0.04 of its potential returns per unit of risk. The Ignitis Grupe AB is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,794 in Ignitis Grupe AB on September 12, 2024 and sell it today you would earn a total of 66.00 from holding Ignitis Grupe AB or generate 3.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 89.23% |
| Values | Daily Returns |
Central Asia Metals vs. Ignitis Grupe AB
Performance |
| Timeline |
| Central Asia Metals |
| Ignitis Grupe AB |
Central Asia and Ignitis Grupe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Asia and Ignitis Grupe
The main advantage of trading using opposite Central Asia and Ignitis Grupe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Asia position performs unexpectedly, Ignitis Grupe 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 Ignitis Grupe will offset losses from the drop in Ignitis Grupe's long position.| Central Asia vs. Ashtead Technology Holdings | Central Asia vs. L3Harris Technologies | Central Asia vs. Roper Technologies | Central Asia vs. Alliance Data Systems |
| Ignitis Grupe vs. Bisichi Mining PLC | Ignitis Grupe vs. Empire Metals Limited | Ignitis Grupe vs. Central Asia Metals | Ignitis Grupe vs. McEwen Mining |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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