Correlation Between Platinum Asset and Althea Group
Can any of the company-specific risk be diversified away by investing in both Platinum Asset and Althea Group 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 Althea Group 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 Althea Group Holdings, you can compare the effects of market volatilities on Platinum Asset and Althea Group 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 Althea Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platinum Asset and Althea Group.
Diversification Opportunities for Platinum Asset and Althea Group
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Platinum and Althea is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Platinum Asset Management and Althea Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Althea Group Holdings 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 Althea Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Althea Group Holdings has no effect on the direction of Platinum Asset i.e., Platinum Asset and Althea Group go up and down completely randomly.
Pair Corralation between Platinum Asset and Althea Group
Assuming the 90 days trading horizon Platinum Asset Management is expected to under-perform the Althea Group. But the stock apears to be less risky and, when comparing its historical volatility, Platinum Asset Management is 1.89 times less risky than Althea Group. The stock trades about -0.04 of its potential returns per unit of risk. The Althea Group Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 5.30 in Althea Group Holdings on November 2, 2024 and sell it today you would lose (1.90) from holding Althea Group Holdings or give up 35.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Platinum Asset Management vs. Althea Group Holdings
Performance |
| Timeline |
| Platinum Asset Management |
| Althea Group Holdings |
Platinum Asset and Althea Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Platinum Asset and Althea Group
The main advantage of trading using opposite Platinum Asset and Althea Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Platinum Asset position performs unexpectedly, Althea Group 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 Althea Group will offset losses from the drop in Althea Group's long position.| Platinum Asset vs. Aneka Tambang Tbk | Platinum Asset vs. BHP Group Limited | Platinum Asset vs. Ecofibre | Platinum Asset vs. iShares Global Healthcare |
| Althea Group vs. Super Retail Group | Althea Group vs. Liberty Financial Group | Althea Group vs. Magellan Financial Group | Althea Group vs. Retail Food Group |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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