Correlation Between Superior Plus and Antofagasta Plc
Can any of the company-specific risk be diversified away by investing in both Superior Plus and Antofagasta Plc 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 Superior Plus and Antofagasta Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and Antofagasta plc, you can compare the effects of market volatilities on Superior Plus and Antofagasta Plc 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 Superior Plus with a short position of Antofagasta Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and Antofagasta Plc.
Diversification Opportunities for Superior Plus and Antofagasta Plc
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Superior and Antofagasta is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and Antofagasta plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Antofagasta plc and Superior Plus 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 Superior Plus Corp are associated (or correlated) with Antofagasta Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Antofagasta plc has no effect on the direction of Superior Plus i.e., Superior Plus and Antofagasta Plc go up and down completely randomly.
Pair Corralation between Superior Plus and Antofagasta Plc
Assuming the 90 days horizon Superior Plus is expected to generate 2.02 times less return on investment than Antofagasta Plc. But when comparing it to its historical volatility, Superior Plus Corp is 1.19 times less risky than Antofagasta Plc. It trades about 0.03 of its potential returns per unit of risk. Antofagasta plc is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,963 in Antofagasta plc on December 30, 2024 and sell it today you would earn a total of 134.00 from holding Antofagasta plc or generate 6.83% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Superior Plus Corp vs. Antofagasta plc
Performance |
Timeline |
Superior Plus Corp |
Antofagasta plc |
Superior Plus and Antofagasta Plc Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Superior Plus and Antofagasta Plc
The main advantage of trading using opposite Superior Plus and Antofagasta Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, Antofagasta Plc 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 Antofagasta Plc will offset losses from the drop in Antofagasta Plc's long position.Superior Plus vs. GALENA MINING LTD | Superior Plus vs. Datang International Power | Superior Plus vs. DATADOT TECHNOLOGY | Superior Plus vs. Stewart Information Services |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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