Correlation Between Argo Investments and Credit Clear
Can any of the company-specific risk be diversified away by investing in both Argo Investments and Credit Clear 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 Argo Investments and Credit Clear into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Argo Investments and Credit Clear, you can compare the effects of market volatilities on Argo Investments and Credit Clear 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 Argo Investments with a short position of Credit Clear. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argo Investments and Credit Clear.
Diversification Opportunities for Argo Investments and Credit Clear
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Argo and Credit is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Argo Investments and Credit Clear in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Clear and Argo Investments 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 Argo Investments are associated (or correlated) with Credit Clear. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Clear has no effect on the direction of Argo Investments i.e., Argo Investments and Credit Clear go up and down completely randomly.
Pair Corralation between Argo Investments and Credit Clear
Assuming the 90 days trading horizon Argo Investments is expected to generate 0.19 times more return on investment than Credit Clear. However, Argo Investments is 5.38 times less risky than Credit Clear. It trades about 0.02 of its potential returns per unit of risk. Credit Clear is currently generating about -0.11 per unit of risk. If you would invest 902.00 in Argo Investments on December 3, 2024 and sell it today you would earn a total of 4.00 from holding Argo Investments or generate 0.44% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Argo Investments vs. Credit Clear
Performance |
Timeline |
Argo Investments |
Credit Clear |
Argo Investments and Credit Clear Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Argo Investments and Credit Clear
The main advantage of trading using opposite Argo Investments and Credit Clear positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Argo Investments position performs unexpectedly, Credit Clear 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 Credit Clear will offset losses from the drop in Credit Clear's long position.Argo Investments vs. Infomedia | Argo Investments vs. Andean Silver Limited | Argo Investments vs. Group 6 Metals | Argo Investments vs. Truscott Mining Corp |
Credit Clear vs. Dalaroo Metals | Credit Clear vs. Bisalloy Steel Group | Credit Clear vs. Centaurus Metals | Credit Clear vs. Aurelia Metals |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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