Correlation Between Selan Exploration and Automotive Stampings
Can any of the company-specific risk be diversified away by investing in both Selan Exploration and Automotive Stampings 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 Selan Exploration and Automotive Stampings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Selan Exploration Technology and Automotive Stampings and, you can compare the effects of market volatilities on Selan Exploration and Automotive Stampings 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 Selan Exploration with a short position of Automotive Stampings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Selan Exploration and Automotive Stampings.
Diversification Opportunities for Selan Exploration and Automotive Stampings
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Selan and Automotive is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Selan Exploration Technology and Automotive Stampings and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Automotive Stampings and and Selan Exploration 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 Selan Exploration Technology are associated (or correlated) with Automotive Stampings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Automotive Stampings and has no effect on the direction of Selan Exploration i.e., Selan Exploration and Automotive Stampings go up and down completely randomly.
Pair Corralation between Selan Exploration and Automotive Stampings
Assuming the 90 days trading horizon Selan Exploration Technology is expected to under-perform the Automotive Stampings. In addition to that, Selan Exploration is 1.32 times more volatile than Automotive Stampings and. It trades about -0.21 of its total potential returns per unit of risk. Automotive Stampings and is currently generating about -0.24 per unit of volatility. If you would invest 67,015 in Automotive Stampings and on November 3, 2024 and sell it today you would lose (11,715) from holding Automotive Stampings and or give up 17.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Selan Exploration Technology vs. Automotive Stampings and
Performance |
| Timeline |
| Selan Exploration |
| Automotive Stampings and |
Selan Exploration and Automotive Stampings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Selan Exploration and Automotive Stampings
The main advantage of trading using opposite Selan Exploration and Automotive Stampings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Selan Exploration position performs unexpectedly, Automotive Stampings 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 Automotive Stampings will offset losses from the drop in Automotive Stampings' long position.| Selan Exploration vs. Digjam Limited | Selan Exploration vs. Kingfa Science Technology | Selan Exploration vs. Rico Auto Industries | Selan Exploration vs. GACM Technologies Limited |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |