Correlation Between American Battery and Rambler Metals

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Can any of the company-specific risk be diversified away by investing in both American Battery and Rambler Metals 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 American Battery and Rambler Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Battery Technology and Rambler Metals and, you can compare the effects of market volatilities on American Battery and Rambler Metals 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 American Battery with a short position of Rambler Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Battery and Rambler Metals.

Diversification Opportunities for American Battery and Rambler Metals

AmericanRamblerDiversified AwayAmericanRamblerDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between American and Rambler is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Battery Technology and Rambler Metals and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rambler Metals and American Battery 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 American Battery Technology are associated (or correlated) with Rambler Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rambler Metals has no effect on the direction of American Battery i.e., American Battery and Rambler Metals go up and down completely randomly.

Pair Corralation between American Battery and Rambler Metals

If you would invest  89.00  in American Battery Technology on November 22, 2024 and sell it today you would earn a total of  19.00  from holding American Battery Technology or generate 21.35% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy98.31%
ValuesDaily Returns

American Battery Technology  vs.  Rambler Metals and

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb 050100150200250
JavaScript chart by amCharts 3.21.15ABAT RBMTF
       Timeline  
American Battery Tec 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in American Battery Technology are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, American Battery unveiled solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb11.522.533.54
Rambler Metals 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Rambler Metals and has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Rambler Metals is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.0690.0695

American Battery and Rambler Metals Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-39.56-29.63-19.7-9.760.1710.3320.6530.9841.31 0.00050.00100.00150.00200.0025
JavaScript chart by amCharts 3.21.15ABAT RBMTF
       Returns  

Pair Trading with American Battery and Rambler Metals

The main advantage of trading using opposite American Battery and Rambler Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Battery position performs unexpectedly, Rambler Metals 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 Rambler Metals will offset losses from the drop in Rambler Metals' long position.
The idea behind American Battery Technology and Rambler Metals and pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.

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