Correlation Between Nine Entertainment and Aurelia Metals
Can any of the company-specific risk be diversified away by investing in both Nine Entertainment and Aurelia Metals 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 Nine Entertainment and Aurelia Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nine Entertainment Co and Aurelia Metals, you can compare the effects of market volatilities on Nine Entertainment and Aurelia Metals 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 Nine Entertainment with a short position of Aurelia Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nine Entertainment and Aurelia Metals.
Diversification Opportunities for Nine Entertainment and Aurelia Metals
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nine and Aurelia is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Nine Entertainment Co and Aurelia Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurelia Metals and Nine Entertainment 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 Nine Entertainment Co are associated (or correlated) with Aurelia Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurelia Metals has no effect on the direction of Nine Entertainment i.e., Nine Entertainment and Aurelia Metals go up and down completely randomly.
Pair Corralation between Nine Entertainment and Aurelia Metals
Assuming the 90 days trading horizon Nine Entertainment Co is expected to generate 0.38 times more return on investment than Aurelia Metals. However, Nine Entertainment Co is 2.65 times less risky than Aurelia Metals. It trades about 0.1 of its potential returns per unit of risk. Aurelia Metals is currently generating about -0.05 per unit of risk. If you would invest 126.00 in Nine Entertainment Co on October 12, 2024 and sell it today you would earn a total of 4.00 from holding Nine Entertainment Co or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Nine Entertainment Co vs. Aurelia Metals
Performance |
| Timeline |
| Nine Entertainment |
| Aurelia Metals |
Nine Entertainment and Aurelia Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nine Entertainment and Aurelia Metals
The main advantage of trading using opposite Nine Entertainment and Aurelia Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nine Entertainment position performs unexpectedly, Aurelia Metals 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 Aurelia Metals will offset losses from the drop in Aurelia Metals' long position.| Nine Entertainment vs. Clime Investment Management | Nine Entertainment vs. Carlton Investments | Nine Entertainment vs. Firstwave Cloud Technology | Nine Entertainment vs. Pinnacle Investment Management |
| Aurelia Metals vs. Latitude Financial Services | Aurelia Metals vs. Perpetual Credit Income | Aurelia Metals vs. Nine Entertainment Co | Aurelia Metals vs. COAST ENTERTAINMENT HOLDINGS |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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