Correlation Between Alcoa Corp and Simt Multi-asset
Can any of the company-specific risk be diversified away by investing in both Alcoa Corp and Simt Multi-asset 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 Alcoa Corp and Simt Multi-asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alcoa Corp and Simt Multi Asset Accumulation, you can compare the effects of market volatilities on Alcoa Corp and Simt Multi-asset 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 Corp with a short position of Simt Multi-asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alcoa Corp and Simt Multi-asset.
Diversification Opportunities for Alcoa Corp and Simt Multi-asset
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alcoa and Simt is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Alcoa Corp and Simt Multi Asset Accumulation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Multi Asset and Alcoa Corp 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 Corp are associated (or correlated) with Simt Multi-asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simt Multi Asset has no effect on the direction of Alcoa Corp i.e., Alcoa Corp and Simt Multi-asset go up and down completely randomly.
Pair Corralation between Alcoa Corp and Simt Multi-asset
Allowing for the 90-day total investment horizon Alcoa Corp is expected to generate 7.07 times more return on investment than Simt Multi-asset. However, Alcoa Corp is 7.07 times more volatile than Simt Multi Asset Accumulation. It trades about 0.13 of its potential returns per unit of risk. Simt Multi Asset Accumulation is currently generating about 0.22 per unit of risk. If you would invest 2,651 in Alcoa Corp on June 1, 2025 and sell it today you would earn a total of 568.00 from holding Alcoa Corp or generate 21.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Alcoa Corp vs. Simt Multi Asset Accumulation
Performance |
| Timeline |
| Alcoa Corp |
| Simt Multi Asset |
Alcoa Corp and Simt Multi-asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alcoa Corp and Simt Multi-asset
The main advantage of trading using opposite Alcoa Corp and Simt Multi-asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alcoa Corp position performs unexpectedly, Simt Multi-asset 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 Simt Multi-asset will offset losses from the drop in Simt Multi-asset's long position.| Alcoa Corp vs. Gold Resource | Alcoa Corp vs. McEwen Mining | Alcoa Corp vs. Paramount Gold Nevada | Alcoa Corp vs. Vista Gold |
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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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