Correlation Between Apex Mining and Altus Property

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

By analyzing existing cross correlation between Apex Mining Co and Altus Property Ventures, you can compare the effects of market volatilities on Apex Mining and Altus Property 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 Apex Mining with a short position of Altus Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apex Mining and Altus Property.

Diversification Opportunities for Apex Mining and Altus Property

0.14

Correlation Coefficient

Apex Mining  Altus Property

Average diversification

The 3 months correlation between Apex and Altus is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Apex Mining Co and Altus Property Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altus Property Ventures and Apex Mining 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 Apex Mining Co are associated (or correlated) with Altus Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altus Property Ventures has no effect on the direction of Apex Mining i.e., Apex Mining and Altus Property go up and down completely randomly.

Pair Corralation between Apex Mining and Altus Property

Assuming the 90 days trading horizon Apex Mining Co is expected to under-perform the Altus Property. But the stock apears to be less risky and, when comparing its historical volatility, Apex Mining Co is 1.68 times less risky than Altus Property. The stock trades about -0.12 of its potential returns per unit of risk. The Altus Property Ventures is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  828.00  in Altus Property Ventures on September 18, 2024 and sell it today you would earn a total of  8.00  from holding Altus Property Ventures or generate 0.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	92.06%
Values	Daily Returns

Apex Mining Co  vs.  Altus Property Ventures

Apex Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apex Mining Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Altus Property Ventures

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Altus Property Ventures are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Altus Property is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Apex Mining and Altus Property

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

The idea behind Apex Mining Co and Altus Property Ventures 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.