Correlation Between Peel Mining and Autosports
Can any of the company-specific risk be diversified away by investing in both Peel Mining and Autosports 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 Peel Mining and Autosports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peel Mining and Autosports Group, you can compare the effects of market volatilities on Peel Mining and Autosports 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 Peel Mining with a short position of Autosports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peel Mining and Autosports.
Diversification Opportunities for Peel Mining and Autosports
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Peel and Autosports is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Peel Mining and Autosports Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autosports Group and Peel Mining 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 Peel Mining are associated (or correlated) with Autosports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autosports Group has no effect on the direction of Peel Mining i.e., Peel Mining and Autosports go up and down completely randomly.
Pair Corralation between Peel Mining and Autosports
Assuming the 90 days trading horizon Peel Mining is expected to under-perform the Autosports. In addition to that, Peel Mining is 1.94 times more volatile than Autosports Group. It trades about -0.22 of its total potential returns per unit of risk. Autosports Group is currently generating about 0.06 per unit of volatility. If you would invest 172.00 in Autosports Group on October 29, 2024 and sell it today you would earn a total of 2.00 from holding Autosports Group or generate 1.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peel Mining vs. Autosports Group
Performance |
| Timeline |
| Peel Mining |
| Autosports Group |
Peel Mining and Autosports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peel Mining and Autosports
The main advantage of trading using opposite Peel Mining and Autosports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peel Mining position performs unexpectedly, Autosports 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 Autosports will offset losses from the drop in Autosports' long position.| Peel Mining vs. Insurance Australia Group | Peel Mining vs. Epsilon Healthcare | Peel Mining vs. Medical Developments International | Peel Mining vs. Queste Communications |
| Autosports vs. Ainsworth Game Technology | Autosports vs. Viva Leisure | Autosports vs. BKI Investment | Autosports vs. Flagship Investments |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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