Correlation Between WA1 Resources and Imugene
Can any of the company-specific risk be diversified away by investing in both WA1 Resources and Imugene 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 WA1 Resources and Imugene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WA1 Resources and Imugene, you can compare the effects of market volatilities on WA1 Resources and Imugene 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 WA1 Resources with a short position of Imugene. Check out your portfolio center. Please also check ongoing floating volatility patterns of WA1 Resources and Imugene.
Diversification Opportunities for WA1 Resources and Imugene
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between WA1 and Imugene is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding WA1 Resources and Imugene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imugene and WA1 Resources 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 WA1 Resources are associated (or correlated) with Imugene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imugene has no effect on the direction of WA1 Resources i.e., WA1 Resources and Imugene go up and down completely randomly.
Pair Corralation between WA1 Resources and Imugene
Assuming the 90 days trading horizon WA1 Resources is expected to generate 0.93 times more return on investment than Imugene. However, WA1 Resources is 1.08 times less risky than Imugene. It trades about 0.09 of its potential returns per unit of risk. Imugene is currently generating about -0.02 per unit of risk. If you would invest 557.00 in WA1 Resources on August 26, 2024 and sell it today you would earn a total of 1,024 from holding WA1 Resources or generate 183.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.7% |
| Values | Daily Returns |
WA1 Resources vs. Imugene
Performance |
| Timeline |
| WA1 Resources |
| Imugene |
WA1 Resources and Imugene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WA1 Resources and Imugene
The main advantage of trading using opposite WA1 Resources and Imugene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WA1 Resources position performs unexpectedly, Imugene 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 Imugene will offset losses from the drop in Imugene's long position.| WA1 Resources vs. Northern Star Resources | WA1 Resources vs. Evolution Mining | WA1 Resources vs. Bluescope Steel | WA1 Resources vs. Sandfire Resources NL |
| Imugene vs. Super Retail Group | Imugene vs. Sky Metals | Imugene vs. Charter Hall Retail | Imugene vs. Aurelia Metals |
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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