Correlation Between Monks Investment and Atalaya Mining
Can any of the company-specific risk be diversified away by investing in both Monks Investment and Atalaya 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 Monks Investment and Atalaya Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monks Investment Trust and Atalaya Mining, you can compare the effects of market volatilities on Monks Investment and Atalaya 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 Monks Investment with a short position of Atalaya Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monks Investment and Atalaya Mining.
Diversification Opportunities for Monks Investment and Atalaya Mining
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Monks and Atalaya is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Monks Investment Trust and Atalaya Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atalaya Mining and Monks Investment 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 Monks Investment Trust are associated (or correlated) with Atalaya Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atalaya Mining has no effect on the direction of Monks Investment i.e., Monks Investment and Atalaya Mining go up and down completely randomly.
Pair Corralation between Monks Investment and Atalaya Mining
Assuming the 90 days trading horizon Monks Investment Trust is expected to generate 0.6 times more return on investment than Atalaya Mining. However, Monks Investment Trust is 1.67 times less risky than Atalaya Mining. It trades about 0.18 of its potential returns per unit of risk. Atalaya Mining is currently generating about -0.13 per unit of risk. If you would invest 128,000 in Monks Investment Trust on November 4, 2024 and sell it today you would earn a total of 5,600 from holding Monks Investment Trust or generate 4.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Monks Investment Trust vs. Atalaya Mining
Performance |
| Timeline |
| Monks Investment Trust |
| Atalaya Mining |
Monks Investment and Atalaya Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monks Investment and Atalaya Mining
The main advantage of trading using opposite Monks Investment and Atalaya Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monks Investment position performs unexpectedly, Atalaya 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 Atalaya Mining will offset losses from the drop in Atalaya Mining's long position.| Monks Investment vs. Verizon Communications | Monks Investment vs. Porvair plc | Monks Investment vs. Zegona Communications Plc | Monks Investment vs. Sealed Air Corp |
| Atalaya Mining vs. Cognizant Technology Solutions | Atalaya Mining vs. Associated British Foods | Atalaya Mining vs. Premier Foods PLC | Atalaya Mining vs. National Beverage 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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