Correlation Between Mayfair Gold and Altair Engineering
Can any of the company-specific risk be diversified away by investing in both Mayfair Gold and Altair Engineering 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 Mayfair Gold and Altair Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mayfair Gold Corp and Altair Engineering, you can compare the effects of market volatilities on Mayfair Gold and Altair Engineering 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 Mayfair Gold with a short position of Altair Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mayfair Gold and Altair Engineering.
Diversification Opportunities for Mayfair Gold and Altair Engineering
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mayfair and Altair is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Mayfair Gold Corp and Altair Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altair Engineering and Mayfair Gold 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 Mayfair Gold Corp are associated (or correlated) with Altair Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altair Engineering has no effect on the direction of Mayfair Gold i.e., Mayfair Gold and Altair Engineering go up and down completely randomly.
Pair Corralation between Mayfair Gold and Altair Engineering
Assuming the 90 days horizon Mayfair Gold is expected to generate 4.42 times less return on investment than Altair Engineering. In addition to that, Mayfair Gold is 1.25 times more volatile than Altair Engineering. It trades about 0.01 of its total potential returns per unit of risk. Altair Engineering is currently generating about 0.08 per unit of volatility. If you would invest 5,497 in Altair Engineering on October 23, 2024 and sell it today you would earn a total of 5,544 from holding Altair Engineering or generate 100.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Mayfair Gold Corp vs. Altair Engineering
Performance |
| Timeline |
| Mayfair Gold Corp |
| Altair Engineering |
Mayfair Gold and Altair Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mayfair Gold and Altair Engineering
The main advantage of trading using opposite Mayfair Gold and Altair Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mayfair Gold position performs unexpectedly, Altair Engineering 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 Altair Engineering will offset losses from the drop in Altair Engineering's long position.| Mayfair Gold vs. Agnico Eagle Mines | Mayfair Gold vs. B2Gold Corp | Mayfair Gold vs. Pan American Silver | Mayfair Gold vs. Gold Fields Ltd |
| Altair Engineering vs. Global Blue Group | Altair Engineering vs. EverCommerce | Altair Engineering vs. CSG Systems International | Altair Engineering vs. Consensus Cloud Solutions |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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