Correlation Between Tesla and Almaden Minerals
Can any of the company-specific risk be diversified away by investing in both Tesla and Almaden Minerals 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 Tesla and Almaden Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tesla Inc CDR and Almaden Minerals, you can compare the effects of market volatilities on Tesla and Almaden Minerals 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 Tesla with a short position of Almaden Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tesla and Almaden Minerals.
Diversification Opportunities for Tesla and Almaden Minerals
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tesla and Almaden is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Tesla Inc CDR and Almaden Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almaden Minerals and Tesla 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 Tesla Inc CDR are associated (or correlated) with Almaden Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almaden Minerals has no effect on the direction of Tesla i.e., Tesla and Almaden Minerals go up and down completely randomly.
Pair Corralation between Tesla and Almaden Minerals
Assuming the 90 days trading horizon Tesla Inc CDR is expected to generate 0.6 times more return on investment than Almaden Minerals. However, Tesla Inc CDR is 1.66 times less risky than Almaden Minerals. It trades about 0.19 of its potential returns per unit of risk. Almaden Minerals is currently generating about 0.02 per unit of risk. If you would invest 1,885 in Tesla Inc CDR on August 28, 2024 and sell it today you would earn a total of 1,202 from holding Tesla Inc CDR or generate 63.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tesla Inc CDR vs. Almaden Minerals
Performance |
| Timeline |
| Tesla Inc CDR |
| Almaden Minerals |
Tesla and Almaden Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tesla and Almaden Minerals
The main advantage of trading using opposite Tesla and Almaden Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tesla position performs unexpectedly, Almaden Minerals 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 Almaden Minerals will offset losses from the drop in Almaden Minerals' long position.| Tesla vs. Western Copper and | Tesla vs. iA Financial | Tesla vs. Canso Credit Trust | Tesla vs. Fairfax Financial Holdings |
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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