Correlation Between Hosken Consolidated and AngloGold Ashanti
Can any of the company-specific risk be diversified away by investing in both Hosken Consolidated and AngloGold Ashanti 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 Hosken Consolidated and AngloGold Ashanti into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hosken Consolidated Investments and AngloGold Ashanti, you can compare the effects of market volatilities on Hosken Consolidated and AngloGold Ashanti 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 Hosken Consolidated with a short position of AngloGold Ashanti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hosken Consolidated and AngloGold Ashanti.
Diversification Opportunities for Hosken Consolidated and AngloGold Ashanti
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hosken and AngloGold is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Hosken Consolidated Investment and AngloGold Ashanti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AngloGold Ashanti and Hosken Consolidated 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 Hosken Consolidated Investments are associated (or correlated) with AngloGold Ashanti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AngloGold Ashanti has no effect on the direction of Hosken Consolidated i.e., Hosken Consolidated and AngloGold Ashanti go up and down completely randomly.
Pair Corralation between Hosken Consolidated and AngloGold Ashanti
Assuming the 90 days trading horizon Hosken Consolidated Investments is expected to under-perform the AngloGold Ashanti. But the stock apears to be less risky and, when comparing its historical volatility, Hosken Consolidated Investments is 1.69 times less risky than AngloGold Ashanti. The stock trades about -0.04 of its potential returns per unit of risk. The AngloGold Ashanti is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,325,546 in AngloGold Ashanti on September 2, 2024 and sell it today you would earn a total of 1,196,454 from holding AngloGold Ashanti or generate 35.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hosken Consolidated Investment vs. AngloGold Ashanti
Performance |
| Timeline |
| Hosken Consolidated |
| AngloGold Ashanti |
Hosken Consolidated and AngloGold Ashanti Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hosken Consolidated and AngloGold Ashanti
The main advantage of trading using opposite Hosken Consolidated and AngloGold Ashanti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hosken Consolidated position performs unexpectedly, AngloGold Ashanti 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 AngloGold Ashanti will offset losses from the drop in AngloGold Ashanti's long position.| Hosken Consolidated vs. Deneb Investments | Hosken Consolidated vs. Centaur Bci Balanced | Hosken Consolidated vs. Sabvest Capital | Hosken Consolidated vs. AfricaRhodium ETF |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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