Correlation Between OOhMedia and Aspire Mining
Can any of the company-specific risk be diversified away by investing in both OOhMedia and Aspire 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 OOhMedia and Aspire Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between oOhMedia and Aspire Mining, you can compare the effects of market volatilities on OOhMedia and Aspire 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 OOhMedia with a short position of Aspire Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of OOhMedia and Aspire Mining.
Diversification Opportunities for OOhMedia and Aspire Mining
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between OOhMedia and Aspire is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding oOhMedia and Aspire Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aspire Mining and OOhMedia 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 oOhMedia are associated (or correlated) with Aspire Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aspire Mining has no effect on the direction of OOhMedia i.e., OOhMedia and Aspire Mining go up and down completely randomly.
Pair Corralation between OOhMedia and Aspire Mining
Assuming the 90 days trading horizon oOhMedia is expected to generate 0.26 times more return on investment than Aspire Mining. However, oOhMedia is 3.81 times less risky than Aspire Mining. It trades about 0.13 of its potential returns per unit of risk. Aspire Mining is currently generating about 0.02 per unit of risk. If you would invest 120.00 in oOhMedia on August 30, 2024 and sell it today you would earn a total of 4.00 from holding oOhMedia or generate 3.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
oOhMedia vs. Aspire Mining
Performance |
| Timeline |
| oOhMedia |
| Aspire Mining |
OOhMedia and Aspire Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OOhMedia and Aspire Mining
The main advantage of trading using opposite OOhMedia and Aspire Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OOhMedia position performs unexpectedly, Aspire 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 Aspire Mining will offset losses from the drop in Aspire Mining's long position.| OOhMedia vs. Macquarie Group | OOhMedia vs. Macquarie Group Ltd | OOhMedia vs. Commonwealth Bank | OOhMedia vs. Rio Tinto |
| Aspire Mining vs. Oceania Healthcare | Aspire Mining vs. Black Rock Mining | Aspire Mining vs. The Environmental Group | Aspire Mining vs. Sonic Healthcare |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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