Rio Tinto Adr Stock Volatility
| RIO Stock | USD 98.07 0.16 0.16% |
Rio Tinto appears to be very steady, given 3 months investment horizon. Rio Tinto ADR maintains Sharpe Ratio (i.e., Efficiency) of 0.3, which implies the firm had a 0.3 % return per unit of risk over the last 3 months. By analyzing Rio Tinto's technical indicators, you can evaluate if the expected return of 0.56% is justified by implied risk. Please evaluate Rio Tinto's Coefficient Of Variation of 347.12, risk adjusted performance of 0.238, and Semi Deviation of 1.41 to confirm if our risk estimates are consistent with your expectations.
Sharpe Ratio = 0.2989
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Based on monthly moving average Rio Tinto is performing at about 23% of its full potential. If added to a well diversified portfolio the total return can be enhanced and market risk can be reduced. You can increase risk-adjusted return of Rio Tinto by adding it to a well-diversified portfolio.
Key indicators related to Rio Tinto's volatility include:90 Days Market Risk | Chance Of Distress | 90 Days Economic Sensitivity |
Rio Tinto Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Rio daily returns, and it is calculated using variance and standard deviation. We also use Rio's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Rio Tinto volatility.
ESG Sustainability
While most ESG disclosures are voluntary, Rio Tinto's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Rio Tinto's managers and investors.Environmental | Governance | Social |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Rio Tinto can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Rio Tinto at lower prices. For example, an investor can purchase Rio stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Rio Tinto's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns. Main indicators related to Rio Tinto's market risk premium analysis include:
Beta 0.78 | Alpha 0.47 | Risk 1.87 | Sharpe Ratio 0.3 | Expected Return 0.56 |
Moving together with Rio Stock
| 0.93 | AACA | AALBERTS IND | PairCorr |
| 0.94 | CAV | Carnavale Resources Split | PairCorr |
| 0.82 | C9F | CHIPOTLE MEXICAN | PairCorr |
| 0.74 | VVDH | VEOLIA ENV SP | PairCorr |
| 0.8 | C9F | CHIPOTLE MEXICAN | PairCorr |
| 0.86 | 21L | Alphamin Resources Corp | PairCorr |
| 0.63 | PEX | Pacific Ridge Exploration | PairCorr |
| 0.76 | RMY | RAMSAY HEALTH CARE | PairCorr |
| 0.68 | FR7 | Fast Retailing | PairCorr |
| 0.75 | CVLC | VALE N1 | PairCorr |
| 0.79 | CWN | CROWN HOLDINGS | PairCorr |
| 0.95 | OTP | OTP Bank Nyrt | PairCorr |
| 0.83 | A8D | AB SCIENCE | PairCorr |
| 0.69 | PF8 | European Lithium | PairCorr |
Moving against Rio Stock
| 0.76 | 6WX | CN LONGYUAN POWER | PairCorr |
| 0.67 | VA7A | VERISK ANLYTCS A Earnings Call This Week | PairCorr |
| 0.67 | 6RC | REPROCELL | PairCorr |
Rio Tinto Market Sensitivity And Downside Risk
Rio Tinto's beta coefficient measures the volatility of Rio stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Rio stock's returns against your selected market. In other words, Rio Tinto's beta of 0.78 provides an investor with an approximation of how much risk Rio Tinto stock can potentially add to one of your existing portfolios. Rio Tinto ADR has relatively low volatility with skewness of -0.69 and kurtosis of 1.54. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Rio Tinto's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Rio Tinto's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Rio Tinto ADR Demand TrendCheck current 90 days Rio Tinto correlation with market (Dow Jones Industrial)Rio Tinto Volatility and Downside Risk
Rio standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Using Rio Put Option to Manage Risk
Put options written on Rio Tinto grant holders of the option the right to sell a specified amount of Rio Tinto at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Rio Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Rio Tinto's position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Rio Tinto will be realized, the loss incurred will be offset by the profits made with the option trade.
Rio Tinto's PUT expiring on 2026-05-15
Profit |
| Rio Tinto Price At Expiration |
Current Rio Tinto Insurance Chain
| Delta | Gamma | Open Int | Expiration | Current Spread | Last Price | |||
Put | RIO260515P00055000 | -0.082411 | 0.003039 | 1 | 2026-05-15 | 0.0 - 2.35 | 0.0 | View |
Put | RIO260515P00065000 | -0.03765 | 0.003387 | 150 | 2026-05-15 | 0.3 - 0.55 | 0.0 | View |
Put | RIO260515P00070000 | -0.058756 | 0.005178 | 2 | 2026-05-15 | 0.5 - 0.75 | 0.0 | View |
Put | RIO260515P00075000 | -0.08538 | 0.007585 | 8 | 2026-05-15 | 0.8 - 3.1 | 0.0 | View |
Put | RIO260515P00080000 | -0.13424 | 0.011048 | 904 | 2026-05-15 | 1.4 - 3.1 | 0.0 | View |
Put | RIO260515P00082500 | -0.199973 | 0.012093 | 43 | 2026-05-15 | 1.8 - 4.0 | 0.0 | View |
Put | RIO260515P00085000 | -0.215831 | 0.014512 | 68 | 2026-05-15 | 2.3 - 3.2 | 0.0 | View |
Put | RIO260515P00087500 | -0.251514 | 0.016671 | 71 | 2026-05-15 | 2.95 - 3.4 | 0.0 | View |
Put | RIO260515P00090000 | -0.298194 | 0.018357 | 92 | 2026-05-15 | 3.7 - 4.2 | 0.0 | View |
Put | RIO260515P00092500 | -0.347804 | 0.019948 | 89 | 2026-05-15 | 4.6 - 6.9 | 0.0 | View |
Put | RIO260515P00095000 | -0.402722 | 0.018659 | 108 | 2026-05-15 | 5.7 - 7.8 | 0.0 | View |
Rio Tinto ADR Stock Volatility Analysis
Volatility refers to the frequency at which Rio Tinto stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Rio Tinto's price changes. Investors will then calculate the volatility of Rio Tinto's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Rio Tinto's volatility:
Historical Volatility
This type of stock volatility measures Rio Tinto's fluctuations based on previous trends. It's commonly used to predict Rio Tinto's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Rio Tinto's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Rio Tinto's to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Rio Tinto ADR Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Rio Tinto Projected Return Density Against Market
Considering the 90-day investment horizon Rio Tinto has a beta of 0.7751 indicating as returns on the market go up, Rio Tinto average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding Rio Tinto ADR will be expected to be much smaller as well.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Rio Tinto or Metals & Mining sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Rio Tinto's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Rio stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Predicted Return Density |
| Returns |
What Drives a Rio Tinto Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract investor attention to the company. This positive attention may impact the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Rio Tinto Stock Risk Measures
Considering the 90-day investment horizon the coefficient of variation of Rio Tinto is 334.57. The daily returns are distributed with a variance of 3.51 and standard deviation of 1.87. The mean deviation of Rio Tinto ADR is currently at 1.4. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.81
α | Alpha over Dow Jones | 0.47 | |
β | Beta against Dow Jones | 0.78 | |
σ | Overall volatility | 1.87 | |
Ir | Information ratio | 0.25 |
Rio Tinto Stock Return Volatility
Rio Tinto historical daily return volatility represents how much of Rio Tinto stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm has volatility of 1.874% on return distribution over 90 days investment horizon. By contrast, Dow Jones Industrial accepts 0.7702% volatility on return distribution over the 90 days horizon. Performance |
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Related Correlations Analysis
Risk-Adjusted Indicators
There is a big difference between Rio Stock performing well and Rio Tinto Company doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze Rio Tinto's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.| Mean Deviation | Jensen Alpha | Sortino Ratio | Treynor Ratio | Semi Deviation | Expected Shortfall | Potential Upside | Value @Risk | Maximum Drawdown | ||
|---|---|---|---|---|---|---|---|---|---|---|
| SCCO | 2.42 | 0.53 | 0.15 | 0.43 | 2.95 | 4.92 | 20.79 | |||
| BHP | 1.53 | 0.43 | 0.20 | (11.65) | 1.54 | 3.84 | 9.15 | |||
| VALE | 1.71 | 0.51 | 0.22 | 0.68 | 1.75 | 4.50 | 12.92 | |||
| NEM | 2.34 | 0.49 | 0.14 | 0.35 | 3.17 | 5.48 | 17.21 | |||
| CRH | 1.58 | 0.08 | 0.06 | 0.12 | 1.80 | 3.35 | 10.55 | |||
| SHW | 1.04 | 0.06 | 0.04 | 0.12 | 1.12 | 2.69 | 6.63 | |||
| AEM | 2.11 | 0.35 | 0.10 | 0.34 | 3.11 | 4.31 | 17.48 | |||
| GSM | 2.42 | 0.44 | 0.15 | 0.50 | 2.48 | 5.66 | 19.69 | |||
| ECL | 0.89 | 0.18 | 0.16 | 0.33 | 0.69 | 2.28 | 4.92 | |||
| TECK | 2.25 | 0.45 | 0.14 | 0.36 | 2.72 | 4.80 | 14.22 |
About Rio Tinto Volatility
Volatility is a rate at which the price of Rio Tinto or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Rio Tinto may increase or decrease. In other words, similar to Rio's beta indicator, it measures the risk of Rio Tinto and helps estimate the fluctuations that may happen in a short period of time. So if prices of Rio Tinto fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.| Last Reported | Projected for Next Year | ||
| Selling And Marketing Expenses | 2.6 B | 2.2 B | |
| Market Cap | 86.3 B | 46 B |
Rio Tinto's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Rio Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Rio Tinto's price varies over time.
3 ways to utilize Rio Tinto's volatility to invest better
Higher Rio Tinto's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Rio Tinto ADR stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Rio Tinto ADR stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Rio Tinto ADR investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Rio Tinto's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Rio Tinto's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Rio Tinto Investment Opportunity
Rio Tinto ADR has a volatility of 1.87 and is 2.43 times more volatile than Dow Jones Industrial. 16 percent of all equities and portfolios are less risky than Rio Tinto. You can use Rio Tinto ADR to enhance the returns of your portfolios. The stock experiences a normal upward fluctuation. Check odds of Rio Tinto to be traded at $102.97 in 90 days.Very poor diversification
The correlation between Rio Tinto ADR and DJI is 0.87 (i.e., Very poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Rio Tinto ADR and DJI in the same portfolio, assuming nothing else is changed.
Rio Tinto Additional Risk Indicators
The analysis of Rio Tinto's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Rio Tinto's investment and either accepting that risk or mitigating it. Along with some common measures of Rio Tinto stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.238 | |||
| Market Risk Adjusted Performance | 0.6707 | |||
| Mean Deviation | 1.35 | |||
| Semi Deviation | 1.41 | |||
| Downside Deviation | 1.98 | |||
| Coefficient Of Variation | 347.12 | |||
| Standard Deviation | 1.81 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Rio Tinto Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Rio Tinto as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Rio Tinto's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Rio Tinto's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Rio Tinto ADR.
When determining whether Rio Tinto ADR offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Rio Tinto's financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Rio Tinto Adr Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Rio Tinto Adr Stock: Check out Your Equity Center to better understand how to build diversified portfolios, which includes a position in Rio Tinto ADR. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in gross domestic product. You can also try the Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Will Diversified Metals & Mining sector continue expanding? Could Rio diversify its offerings? Factors like these will boost the valuation of Rio Tinto. Anticipated expansion of Rio directly elevates investor willingness to pay premium valuations. Accurate valuation requires analyzing both current fundamentals and future growth trajectories. Every Rio Tinto data point contributes insight, yet successful analysis hinges on identifying the most consequential variables.
Quarterly Earnings Growth (0.22) | Dividend Share 3.73 | Earnings Share 6.28 | Revenue Per Share | Quarterly Revenue Growth 0.003 |
Rio Tinto ADR's market price often diverges from its book value, the accounting figure shown on Rio's balance sheet. Smart investors calculate Rio Tinto's intrinsic value - its true economic worth - which may differ significantly from both market price and book value. Seasoned market participants apply comprehensive analytical frameworks to derive fundamental worth and identify mispriced opportunities. Since Rio Tinto's trading price responds to investor sentiment, macroeconomic conditions, and market psychology, it can swing far from fundamental value.
It's important to distinguish between Rio Tinto's intrinsic value and market price, which are calculated using different methodologies. Investment decisions regarding Rio Tinto should consider multiple factors including financial performance, growth metrics, competitive position, and professional analysis. However, Rio Tinto's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.