This module allows you to analyze existing cross correlation between Alcoa Corporation and Aluminum Corporation Of China Limited. You can compare the effects of market volatilities on Alcoa and Aluminum Of 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 Alcoa with a short position of Aluminum Of. See also your portfolio center
. Please also check ongoing floating volatility patterns of Alcoa
and Aluminum Of
Alcoa Corp. vs Aluminum Corp. Of China Limite
Allowing for the 30-days total investment horizon, Alcoa Corporation is expected to generate 0.82 times more return on investment than Aluminum Of. However, Alcoa Corporation is 1.22 times less risky than Aluminum Of. It trades about -0.28 of its potential returns per unit of risk. Aluminum Corporation Of China Limited is currently generating about -0.5 per unit of risk. If you would invest 4,793 in Alcoa Corporation on October 21, 2017 and sell it today you would lose (573) from holding Alcoa Corporation or give up 11.95% of portfolio value over 30 days.
|Time Period||1 Month [change]|
Very poor diversification
Overlapping area represents the amount of risk that can be diversified away by holding Alcoa Corp. and Aluminum Corp. Of China Limite in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Aluminum Of China and Alcoa 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 Alcoa Corporation are associated (or correlated) with Aluminum Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aluminum Of China has no effect on the direction of Alcoa i.e. Alcoa and Aluminum Of go up and down completely randomly.
Over the last 30 days Alcoa Corporation has generated negative risk-adjusted returns adding no value to investors with long positions.
Over the last 30 days Aluminum Corporation Of China Limited has generated negative risk-adjusted returns adding no value to investors with long positions.