Correlation Between Ur Energy and ANGLO ASIAN

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

By analyzing existing cross correlation between Ur Energy and ANGLO ASIAN MINING, you can compare the effects of market volatilities on Ur Energy and ANGLO ASIAN 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 Ur Energy with a short position of ANGLO ASIAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ur Energy and ANGLO ASIAN.

Diversification Opportunities for Ur Energy and ANGLO ASIAN

-0.16

Correlation Coefficient

Ur Energy  ANGLO ASIAN

Good diversification

The 3 months correlation between U9T and ANGLO is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Ur Energy and ANGLO ASIAN MINING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANGLO ASIAN MINING and Ur Energy 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 Ur Energy are associated (or correlated) with ANGLO ASIAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANGLO ASIAN MINING has no effect on the direction of Ur Energy i.e., Ur Energy and ANGLO ASIAN go up and down completely randomly.

Pair Corralation between Ur Energy and ANGLO ASIAN

Assuming the 90 days horizon Ur Energy is expected to generate 1.29 times more return on investment than ANGLO ASIAN. However, Ur Energy is 1.29 times more volatile than ANGLO ASIAN MINING. It trades about 0.18 of its potential returns per unit of risk. ANGLO ASIAN MINING is currently generating about -0.03 per unit of risk. If you would invest  109.00  in Ur Energy on October 26, 2024 and sell it today you would earn a total of  11.00  from holding Ur Energy or generate 10.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	94.74%
Values	Daily Returns

Ur Energy  vs.  ANGLO ASIAN MINING

Ur Energy

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ur Energy are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Ur Energy is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

ANGLO ASIAN MINING

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ANGLO ASIAN MINING has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, ANGLO ASIAN is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Ur Energy and ANGLO ASIAN

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

The idea behind Ur Energy and ANGLO ASIAN MINING 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.