Correlation Between APAC Resources and EBullion

Can any of the company-specific risk be diversified away by investing in both APAC Resources and EBullion 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 APAC Resources and EBullion into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between APAC Resources Limited and EBullion, you can compare the effects of market volatilities on APAC Resources and EBullion 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 APAC Resources with a short position of EBullion. Check out your portfolio center. Please also check ongoing floating volatility patterns of APAC Resources and EBullion.

Diversification Opportunities for APAC Resources and EBullion

0.0

Correlation Coefficient

APAC Resources  EBullion

Pay attention - limited upside

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

Pair Corralation between APAC Resources and EBullion

If you would invest (100.00) in EBullion on December 29, 2024 and sell it today you would earn a total of  100.00  from holding EBullion or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

APAC Resources Limited  vs.  EBullion

APAC Resources

Risk-Adjusted Performance

Very Weak

Over the last 90 days APAC Resources Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, APAC Resources is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

EBullion

Risk-Adjusted Performance

Very Weak

Over the last 90 days EBullion has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent primary indicators, EBullion is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with APAC Resources and EBullion

The main advantage of trading using opposite APAC Resources and EBullion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if APAC Resources position performs unexpectedly, EBullion 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 EBullion will offset losses from the drop in EBullion's long position.

The idea behind APAC Resources Limited and EBullion 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.