Correlation Between Amani Gold and Air New
Can any of the company-specific risk be diversified away by investing in both Amani Gold and Air New 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 Amani Gold and Air New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amani Gold and Air New Zealand, you can compare the effects of market volatilities on Amani Gold and Air New 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 Amani Gold with a short position of Air New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amani Gold and Air New.
Diversification Opportunities for Amani Gold and Air New
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Amani and Air is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Amani Gold and Air New Zealand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air New Zealand and Amani Gold 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 Amani Gold are associated (or correlated) with Air New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air New Zealand has no effect on the direction of Amani Gold i.e., Amani Gold and Air New go up and down completely randomly.
Pair Corralation between Amani Gold and Air New
If you would invest 49.00 in Air New Zealand on September 24, 2024 and sell it today you would earn a total of 3.00 from holding Air New Zealand or generate 6.12% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Amani Gold vs. Air New Zealand
Performance |
Timeline |
Amani Gold |
Air New Zealand |
Amani Gold and Air New Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Amani Gold and Air New
The main advantage of trading using opposite Amani Gold and Air New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amani Gold position performs unexpectedly, Air New 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 Air New will offset losses from the drop in Air New's long position.Amani Gold vs. Northern Star Resources | Amani Gold vs. Evolution Mining | Amani Gold vs. Bluescope Steel | Amani Gold vs. Aneka Tambang Tbk |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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