Correlation Between REGAL ASIAN and Eagle Mountain
Can any of the company-specific risk be diversified away by investing in both REGAL ASIAN and Eagle Mountain 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 REGAL ASIAN and Eagle Mountain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between REGAL ASIAN INVESTMENTS and Eagle Mountain Mining, you can compare the effects of market volatilities on REGAL ASIAN and Eagle Mountain 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 REGAL ASIAN with a short position of Eagle Mountain. Check out your portfolio center. Please also check ongoing floating volatility patterns of REGAL ASIAN and Eagle Mountain.
Diversification Opportunities for REGAL ASIAN and Eagle Mountain
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between REGAL and Eagle is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding REGAL ASIAN INVESTMENTS and Eagle Mountain Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Mountain Mining and REGAL ASIAN 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 REGAL ASIAN INVESTMENTS are associated (or correlated) with Eagle Mountain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Mountain Mining has no effect on the direction of REGAL ASIAN i.e., REGAL ASIAN and Eagle Mountain go up and down completely randomly.
Pair Corralation between REGAL ASIAN and Eagle Mountain
Assuming the 90 days trading horizon REGAL ASIAN INVESTMENTS is expected to generate 0.14 times more return on investment than Eagle Mountain. However, REGAL ASIAN INVESTMENTS is 7.25 times less risky than Eagle Mountain. It trades about -0.02 of its potential returns per unit of risk. Eagle Mountain Mining is currently generating about -0.32 per unit of risk. If you would invest 217.00 in REGAL ASIAN INVESTMENTS on August 28, 2024 and sell it today you would lose (2.00) from holding REGAL ASIAN INVESTMENTS or give up 0.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
REGAL ASIAN INVESTMENTS vs. Eagle Mountain Mining
Performance |
| Timeline |
| REGAL ASIAN INVESTMENTS |
| Eagle Mountain Mining |
REGAL ASIAN and Eagle Mountain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REGAL ASIAN and Eagle Mountain
The main advantage of trading using opposite REGAL ASIAN and Eagle Mountain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REGAL ASIAN position performs unexpectedly, Eagle Mountain 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 Eagle Mountain will offset losses from the drop in Eagle Mountain's long position.| REGAL ASIAN vs. ABACUS STORAGE KING | REGAL ASIAN vs. Odyssey Energy | REGAL ASIAN vs. Hotel Property Investments | REGAL ASIAN vs. Origin Energy |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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