Correlation Between Global Battery and Altair International
Can any of the company-specific risk be diversified away by investing in both Global Battery and Altair International 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 Global Battery and Altair International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Battery Metals and Altair International Corp, you can compare the effects of market volatilities on Global Battery and Altair International 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 Global Battery with a short position of Altair International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Battery and Altair International.
Diversification Opportunities for Global Battery and Altair International
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Altair is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Global Battery Metals and Altair International Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altair International Corp and Global Battery 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 Global Battery Metals are associated (or correlated) with Altair International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altair International Corp has no effect on the direction of Global Battery i.e., Global Battery and Altair International go up and down completely randomly.
Pair Corralation between Global Battery and Altair International
Assuming the 90 days horizon Global Battery is expected to generate 1.12 times less return on investment than Altair International. But when comparing it to its historical volatility, Global Battery Metals is 1.07 times less risky than Altair International. It trades about 0.06 of its potential returns per unit of risk. Altair International Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3.80 in Altair International Corp on November 3, 2024 and sell it today you would earn a total of 0.19 from holding Altair International Corp or generate 5.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Global Battery Metals vs. Altair International Corp
Performance |
| Timeline |
| Global Battery Metals |
| Altair International Corp |
Global Battery and Altair International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Battery and Altair International
The main advantage of trading using opposite Global Battery and Altair International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Battery position performs unexpectedly, Altair International 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 Altair International will offset losses from the drop in Altair International's long position.| Global Battery vs. Altair International Corp | Global Battery vs. Lake Resources NL | Global Battery vs. Jourdan Resources | Global Battery vs. Lomiko Metals |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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