Correlation Between ANGANG STEEL and Monument Mining
Can any of the company-specific risk be diversified away by investing in both ANGANG STEEL and Monument 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 ANGANG STEEL and Monument Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANGANG STEEL H and Monument Mining Limited, you can compare the effects of market volatilities on ANGANG STEEL and Monument 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 ANGANG STEEL with a short position of Monument Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANGANG STEEL and Monument Mining.
Diversification Opportunities for ANGANG STEEL and Monument Mining
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ANGANG and Monument is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding ANGANG STEEL H and Monument Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Monument Mining and ANGANG STEEL 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 ANGANG STEEL H are associated (or correlated) with Monument Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Monument Mining has no effect on the direction of ANGANG STEEL i.e., ANGANG STEEL and Monument Mining go up and down completely randomly.
Pair Corralation between ANGANG STEEL and Monument Mining
Assuming the 90 days trading horizon ANGANG STEEL is expected to generate 9.4 times less return on investment than Monument Mining. But when comparing it to its historical volatility, ANGANG STEEL H is 1.32 times less risky than Monument Mining. It trades about 0.02 of its potential returns per unit of risk. Monument Mining Limited is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 19.00 in Monument Mining Limited on October 29, 2024 and sell it today you would earn a total of 2.00 from holding Monument Mining Limited or generate 10.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANGANG STEEL H vs. Monument Mining Limited
Performance |
| Timeline |
| ANGANG STEEL H |
| Monument Mining |
ANGANG STEEL and Monument Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANGANG STEEL and Monument Mining
The main advantage of trading using opposite ANGANG STEEL and Monument Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANGANG STEEL position performs unexpectedly, Monument 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 Monument Mining will offset losses from the drop in Monument Mining's long position.| ANGANG STEEL vs. Wizz Air Holdings | ANGANG STEEL vs. Canadian Utilities Limited | ANGANG STEEL vs. FAIR ISAAC | ANGANG STEEL vs. NORWEGIAN AIR SHUT |
| Monument Mining vs. QBE Insurance Group | Monument Mining vs. Japan Post Insurance | Monument Mining vs. PENN Entertainment | Monument Mining vs. SBI Insurance Group |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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