Correlation Between New Energy and Altura Mining
Can any of the company-specific risk be diversified away by investing in both New Energy and Altura 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 New Energy and Altura Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between New Energy Metals and Altura Mining Limited, you can compare the effects of market volatilities on New Energy and Altura 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 New Energy with a short position of Altura Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Energy and Altura Mining.
Diversification Opportunities for New Energy and Altura Mining
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between New and Altura is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding New Energy Metals and Altura Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altura Mining Limited and New Energy 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 New Energy Metals are associated (or correlated) with Altura Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altura Mining Limited has no effect on the direction of New Energy i.e., New Energy and Altura Mining go up and down completely randomly.
Pair Corralation between New Energy and Altura Mining
If you would invest 1.00 in Altura Mining Limited on August 29, 2024 and sell it today you would lose (0.48) from holding Altura Mining Limited or give up 48.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
New Energy Metals vs. Altura Mining Limited
Performance |
| Timeline |
| New Energy Metals |
| Altura Mining Limited |
New Energy and Altura Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New Energy and Altura Mining
The main advantage of trading using opposite New Energy and Altura Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Energy position performs unexpectedly, Altura 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 Altura Mining will offset losses from the drop in Altura Mining's long position.| New Energy vs. Legacy Education | New Energy vs. Apple Inc | New Energy vs. NVIDIA | New Energy vs. Microsoft |
| Altura Mining vs. Aurelia Metals Limited | Altura Mining vs. Ascendant Resources | Altura Mining vs. Artemis Resources | Altura Mining vs. Azimut Exploration |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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