Correlation Between Platinum Asset and Australian Strategic
Can any of the company-specific risk be diversified away by investing in both Platinum Asset and Australian Strategic 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 Platinum Asset and Australian Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Platinum Asset Management and Australian Strategic Materials, you can compare the effects of market volatilities on Platinum Asset and Australian Strategic 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 Platinum Asset with a short position of Australian Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platinum Asset and Australian Strategic.
Diversification Opportunities for Platinum Asset and Australian Strategic
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Platinum and Australian is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Platinum Asset Management and Australian Strategic Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Australian Strategic and Platinum Asset 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 Platinum Asset Management are associated (or correlated) with Australian Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Australian Strategic has no effect on the direction of Platinum Asset i.e., Platinum Asset and Australian Strategic go up and down completely randomly.
Pair Corralation between Platinum Asset and Australian Strategic
Assuming the 90 days trading horizon Platinum Asset Management is expected to under-perform the Australian Strategic. In addition to that, Platinum Asset is 1.5 times more volatile than Australian Strategic Materials. It trades about -0.16 of its total potential returns per unit of risk. Australian Strategic Materials is currently generating about 0.22 per unit of volatility. If you would invest 47.00 in Australian Strategic Materials on October 4, 2024 and sell it today you would earn a total of 6.00 from holding Australian Strategic Materials or generate 12.77% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Platinum Asset Management vs. Australian Strategic Materials
Performance |
Timeline |
Platinum Asset Management |
Australian Strategic |
Platinum Asset and Australian Strategic Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Platinum Asset and Australian Strategic
The main advantage of trading using opposite Platinum Asset and Australian Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Platinum Asset position performs unexpectedly, Australian Strategic 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 Australian Strategic will offset losses from the drop in Australian Strategic's long position.Platinum Asset vs. Sandon Capital Investments | Platinum Asset vs. Sports Entertainment Group | Platinum Asset vs. Clime Investment Management | Platinum Asset vs. Regal Investment |
Australian Strategic vs. Northern Star Resources | Australian Strategic vs. Evolution Mining | Australian Strategic vs. Bluescope Steel | Australian Strategic vs. Sandfire Resources NL |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
CEOs Directory Screen CEOs from public companies around the world | |
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |