Correlation Between Rogers Communications and Altius Minerals

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

By analyzing existing cross correlation between Rogers Communications and Altius Minerals, you can compare the effects of market volatilities on Rogers Communications and Altius Minerals 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 Rogers Communications with a short position of Altius Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rogers Communications and Altius Minerals.

Diversification Opportunities for Rogers Communications and Altius Minerals

-0.59

Correlation Coefficient

Rogers Communications  Altius Minerals

Excellent diversification

The 3 months correlation between Rogers and Altius is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Rogers Communications and Altius Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altius Minerals and Rogers Communications 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 Rogers Communications are associated (or correlated) with Altius Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altius Minerals has no effect on the direction of Rogers Communications i.e., Rogers Communications and Altius Minerals go up and down completely randomly.

Pair Corralation between Rogers Communications and Altius Minerals

Assuming the 90 days trading horizon Rogers Communications is expected to generate 0.73 times more return on investment than Altius Minerals. However, Rogers Communications is 1.36 times less risky than Altius Minerals. It trades about 0.29 of its potential returns per unit of risk. Altius Minerals is currently generating about -0.03 per unit of risk. If you would invest  5,539  in Rogers Communications on February 28, 2024 and sell it today you would earn a total of  460.00  from holding Rogers Communications or generate 8.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Rogers Communications  vs.  Altius Minerals

Rogers Communications

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rogers Communications has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Rogers Communications is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Altius Minerals

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Altius Minerals are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, Altius Minerals displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Rogers Communications and Altius Minerals

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

The idea behind Rogers Communications and Altius Minerals 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.