Correlation Between Platinum Asset and Avenira
Can any of the company-specific risk be diversified away by investing in both Platinum Asset and Avenira 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 Platinum Asset and Avenira into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Platinum Asset Management and Avenira, you can compare the effects of market volatilities on Platinum Asset and Avenira 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 Platinum Asset with a short position of Avenira. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platinum Asset and Avenira.
Diversification Opportunities for Platinum Asset and Avenira
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Platinum and Avenira is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Platinum Asset Management and Avenira in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avenira and Platinum Asset 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 Platinum Asset Management are associated (or correlated) with Avenira. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avenira has no effect on the direction of Platinum Asset i.e., Platinum Asset and Avenira go up and down completely randomly.
Pair Corralation between Platinum Asset and Avenira
Assuming the 90 days trading horizon Platinum Asset Management is expected to under-perform the Avenira. But the stock apears to be less risky and, when comparing its historical volatility, Platinum Asset Management is 1.84 times less risky than Avenira. The stock trades about -0.36 of its potential returns per unit of risk. The Avenira is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 1.00 in Avenira on September 15, 2024 and sell it today you would lose (0.10) from holding Avenira or give up 10.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Platinum Asset Management vs. Avenira
Performance |
| Timeline |
| Platinum Asset Management |
| Avenira |
Platinum Asset and Avenira Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Platinum Asset and Avenira
The main advantage of trading using opposite Platinum Asset and Avenira positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Platinum Asset position performs unexpectedly, Avenira 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 Avenira will offset losses from the drop in Avenira's long position.| Platinum Asset vs. Queste Communications | Platinum Asset vs. Bio Gene Technology | Platinum Asset vs. Computershare | Platinum Asset vs. Perseus Mining |
| Avenira vs. Platinum Asset Management | Avenira vs. Regal Funds Management | Avenira vs. Clime Investment Management | Avenira vs. Bluescope Steel |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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