Correlation Between Stallion Discoveries and Altair International

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Can any of the company-specific risk be diversified away by investing in both Stallion Discoveries and Altair International 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 Stallion Discoveries and Altair International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stallion Discoveries Corp and Altair International Corp, you can compare the effects of market volatilities on Stallion Discoveries and Altair International 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 Stallion Discoveries with a short position of Altair International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stallion Discoveries and Altair International.

Diversification Opportunities for Stallion Discoveries and Altair International

StallionAltairDiversified AwayStallionAltairDiversified Away100%
-0.04
  Correlation Coefficient

Good diversification

The 3 months correlation between Stallion and Altair is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Stallion Discoveries Corp and Altair International Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altair International Corp and Stallion Discoveries 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 Stallion Discoveries Corp are associated (or correlated) with Altair International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altair International Corp has no effect on the direction of Stallion Discoveries i.e., Stallion Discoveries and Altair International go up and down completely randomly.

Pair Corralation between Stallion Discoveries and Altair International

Assuming the 90 days horizon Stallion Discoveries is expected to generate 6.85 times less return on investment than Altair International. But when comparing it to its historical volatility, Stallion Discoveries Corp is 1.44 times less risky than Altair International. It trades about 0.01 of its potential returns per unit of risk. Altair International Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  5.80  in Altair International Corp on November 22, 2024 and sell it today you would lose (1.10) from holding Altair International Corp or give up 18.97% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy98.33%
ValuesDaily Returns

Stallion Discoveries Corp  vs.  Altair International Corp

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -2002040
JavaScript chart by amCharts 3.21.15STLNF ATAO
       Timeline  
Stallion Discoveries Corp 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Stallion Discoveries Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Stallion Discoveries is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.0150.020.0250.030.0350.040.045
Altair International Corp 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Altair International Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile basic indicators, Altair International displayed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.0250.030.0350.040.0450.050.0550.060.065

Stallion Discoveries and Altair International Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-32.9-24.64-16.38-8.120.098.1616.4524.7533.05 0.00200.00250.00300.0035
JavaScript chart by amCharts 3.21.15STLNF ATAO
       Returns  

Pair Trading with Stallion Discoveries and Altair International

The main advantage of trading using opposite Stallion Discoveries and Altair International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stallion Discoveries position performs unexpectedly, Altair International 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 Altair International will offset losses from the drop in Altair International's long position.
The idea behind Stallion Discoveries Corp and Altair International Corp 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

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