Correlation Between Impala Platinum and Clean Air
Can any of the company-specific risk be diversified away by investing in both Impala Platinum and Clean Air 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 Impala Platinum and Clean Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impala Platinum Holdings and Clean Air Metals, you can compare the effects of market volatilities on Impala Platinum and Clean Air 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 Impala Platinum with a short position of Clean Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impala Platinum and Clean Air.
Diversification Opportunities for Impala Platinum and Clean Air
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Impala and Clean is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Impala Platinum Holdings and Clean Air Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clean Air Metals and Impala Platinum 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 Impala Platinum Holdings are associated (or correlated) with Clean Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clean Air Metals has no effect on the direction of Impala Platinum i.e., Impala Platinum and Clean Air go up and down completely randomly.
Pair Corralation between Impala Platinum and Clean Air
Assuming the 90 days horizon Impala Platinum Holdings is expected to generate 1.1 times more return on investment than Clean Air. However, Impala Platinum is 1.1 times more volatile than Clean Air Metals. It trades about 0.0 of its potential returns per unit of risk. Clean Air Metals is currently generating about -0.01 per unit of risk. If you would invest 637.00 in Impala Platinum Holdings on January 14, 2025 and sell it today you would lose (31.00) from holding Impala Platinum Holdings or give up 4.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Impala Platinum Holdings vs. Clean Air Metals
Performance |
| Timeline |
| Impala Platinum Holdings |
| Clean Air Metals |
Impala Platinum and Clean Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impala Platinum and Clean Air
The main advantage of trading using opposite Impala Platinum and Clean Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impala Platinum position performs unexpectedly, Clean Air 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 Clean Air will offset losses from the drop in Clean Air's long position.| Impala Platinum vs. Chesapeake Gold Corp | Impala Platinum vs. Usha Resources | Impala Platinum vs. American Copper Development | Impala Platinum vs. Endeavour Silver Corp |
| Clean Air vs. Chesapeake Gold Corp | Clean Air vs. Usha Resources | Clean Air vs. American Copper Development | Clean Air vs. Endeavour Silver Corp |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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