Correlation Between Zanaga Iron and Allstate Corp
Can any of the company-specific risk be diversified away by investing in both Zanaga Iron and Allstate Corp 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 Zanaga Iron and Allstate Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zanaga Iron Ore and Allstate Corp, you can compare the effects of market volatilities on Zanaga Iron and Allstate Corp 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 Zanaga Iron with a short position of Allstate Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zanaga Iron and Allstate Corp.
Diversification Opportunities for Zanaga Iron and Allstate Corp
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Zanaga and Allstate is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Zanaga Iron Ore and Allstate Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allstate Corp and Zanaga Iron 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 Zanaga Iron Ore are associated (or correlated) with Allstate Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allstate Corp has no effect on the direction of Zanaga Iron i.e., Zanaga Iron and Allstate Corp go up and down completely randomly.
Pair Corralation between Zanaga Iron and Allstate Corp
Assuming the 90 days trading horizon Zanaga Iron Ore is expected to generate 4.29 times more return on investment than Allstate Corp. However, Zanaga Iron is 4.29 times more volatile than Allstate Corp. It trades about 0.04 of its potential returns per unit of risk. Allstate Corp is currently generating about 0.06 per unit of risk. If you would invest 560.00 in Zanaga Iron Ore on November 2, 2024 and sell it today you would earn a total of 244.00 from holding Zanaga Iron Ore or generate 43.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 96.39% |
| Values | Daily Returns |
Zanaga Iron Ore vs. Allstate Corp
Performance |
| Timeline |
| Zanaga Iron Ore |
| Allstate Corp |
Zanaga Iron and Allstate Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zanaga Iron and Allstate Corp
The main advantage of trading using opposite Zanaga Iron and Allstate Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zanaga Iron position performs unexpectedly, Allstate Corp 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 Allstate Corp will offset losses from the drop in Allstate Corp's long position.| Zanaga Iron vs. Charter Communications Cl | Zanaga Iron vs. Xeros Technology Group | Zanaga Iron vs. Aeorema Communications Plc | Zanaga Iron vs. Spirent Communications plc |
| Allstate Corp vs. GreenX Metals | Allstate Corp vs. Rheinmetall AG | Allstate Corp vs. Eastinco Mining Exploration | Allstate Corp vs. Jacquet Metal Service |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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