Correlation Between ATHENE and BTU Metals

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

By analyzing existing cross correlation between ATHENE HLDG LTD and BTU Metals Corp, you can compare the effects of market volatilities on ATHENE and BTU Metals 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 ATHENE with a short position of BTU Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATHENE and BTU Metals.

Diversification Opportunities for ATHENE and BTU Metals

0.0

Correlation Coefficient

ATHENE  BTU Metals

Pay attention - limited upside

The 3 months correlation between ATHENE and BTU is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ATHENE HLDG LTD and BTU Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTU Metals Corp and ATHENE 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 ATHENE HLDG LTD are associated (or correlated) with BTU Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTU Metals Corp has no effect on the direction of ATHENE i.e., ATHENE and BTU Metals go up and down completely randomly.

Pair Corralation between ATHENE and BTU Metals

If you would invest  2.73  in BTU Metals Corp on October 11, 2024 and sell it today you would lose (0.73) from holding BTU Metals Corp or give up 26.74% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

ATHENE HLDG LTD  vs.  BTU Metals Corp

ATHENE HLDG LTD

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ATHENE HLDG LTD has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ATHENE is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

BTU Metals Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BTU Metals Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable primary indicators, BTU Metals is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with ATHENE and BTU Metals

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

The idea behind ATHENE HLDG LTD and BTU Metals 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.

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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.