Correlation Between Kingsrose Mining and Autosports
Can any of the company-specific risk be diversified away by investing in both Kingsrose Mining and Autosports 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 Kingsrose Mining and Autosports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kingsrose Mining and Autosports Group, you can compare the effects of market volatilities on Kingsrose Mining and Autosports 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 Kingsrose Mining with a short position of Autosports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingsrose Mining and Autosports.
Diversification Opportunities for Kingsrose Mining and Autosports
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kingsrose and Autosports is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Kingsrose Mining and Autosports Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autosports Group and Kingsrose Mining 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 Kingsrose Mining are associated (or correlated) with Autosports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autosports Group has no effect on the direction of Kingsrose Mining i.e., Kingsrose Mining and Autosports go up and down completely randomly.
Pair Corralation between Kingsrose Mining and Autosports
Assuming the 90 days trading horizon Kingsrose Mining is expected to generate 2.77 times more return on investment than Autosports. However, Kingsrose Mining is 2.77 times more volatile than Autosports Group. It trades about 0.0 of its potential returns per unit of risk. Autosports Group is currently generating about -0.01 per unit of risk. If you would invest 4.40 in Kingsrose Mining on August 27, 2024 and sell it today you would lose (1.10) from holding Kingsrose Mining or give up 25.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kingsrose Mining vs. Autosports Group
Performance |
| Timeline |
| Kingsrose Mining |
| Autosports Group |
Kingsrose Mining and Autosports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingsrose Mining and Autosports
The main advantage of trading using opposite Kingsrose Mining and Autosports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingsrose Mining position performs unexpectedly, Autosports 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 Autosports will offset losses from the drop in Autosports' long position.| Kingsrose Mining vs. Ainsworth Game Technology | Kingsrose Mining vs. Perseus Mining | Kingsrose Mining vs. Sky Metals | Kingsrose Mining vs. Stelar Metals |
| Autosports vs. Aneka Tambang Tbk | Autosports vs. Macquarie Group | Autosports vs. Macquarie Group Ltd | Autosports vs. Challenger |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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