Correlation Between Platinum Asset and Rubicon Water
Can any of the company-specific risk be diversified away by investing in both Platinum Asset and Rubicon Water 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 Rubicon Water 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 Rubicon Water, you can compare the effects of market volatilities on Platinum Asset and Rubicon Water 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 Rubicon Water. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platinum Asset and Rubicon Water.
Diversification Opportunities for Platinum Asset and Rubicon Water
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Platinum and Rubicon is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Platinum Asset Management and Rubicon Water in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rubicon Water 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 Rubicon Water. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rubicon Water has no effect on the direction of Platinum Asset i.e., Platinum Asset and Rubicon Water go up and down completely randomly.
Pair Corralation between Platinum Asset and Rubicon Water
Assuming the 90 days trading horizon Platinum Asset Management is expected to under-perform the Rubicon Water. But the stock apears to be less risky and, when comparing its historical volatility, Platinum Asset Management is 1.13 times less risky than Rubicon Water. The stock trades about -0.43 of its potential returns per unit of risk. The Rubicon Water is currently generating about -0.29 of returns per unit of risk over similar time horizon. If you would invest 37.00 in Rubicon Water on September 13, 2024 and sell it today you would lose (8.00) from holding Rubicon Water or give up 21.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Platinum Asset Management vs. Rubicon Water
Performance |
| Timeline |
| Platinum Asset Management |
| Rubicon Water |
Platinum Asset and Rubicon Water Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Platinum Asset and Rubicon Water
The main advantage of trading using opposite Platinum Asset and Rubicon Water positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Platinum Asset position performs unexpectedly, Rubicon Water 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 Rubicon Water will offset losses from the drop in Rubicon Water's long position.| Platinum Asset vs. Collins Foods | Platinum Asset vs. BTC Health Limited | Platinum Asset vs. Health and Plant | Platinum Asset vs. Sonic Healthcare |
| Rubicon Water vs. Auctus Alternative Investments | Rubicon Water vs. Mirrabooka Investments | Rubicon Water vs. Alternative Investment Trust | Rubicon Water vs. Hansen Technologies |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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