Correlation Between Vale SA and Altiplano Metals
Can any of the company-specific risk be diversified away by investing in both Vale SA and Altiplano 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 Vale SA and Altiplano Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vale SA ADR and Altiplano Metals, you can compare the effects of market volatilities on Vale SA and Altiplano 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 Vale SA with a short position of Altiplano Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vale SA and Altiplano Metals.
Diversification Opportunities for Vale SA and Altiplano Metals
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vale and Altiplano is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Vale SA ADR and Altiplano Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altiplano Metals and Vale SA 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 Vale SA ADR are associated (or correlated) with Altiplano Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altiplano Metals has no effect on the direction of Vale SA i.e., Vale SA and Altiplano Metals go up and down completely randomly.
Pair Corralation between Vale SA and Altiplano Metals
Given the investment horizon of 90 days Vale SA ADR is expected to generate 0.19 times more return on investment than Altiplano Metals. However, Vale SA ADR is 5.19 times less risky than Altiplano Metals. It trades about 0.23 of its potential returns per unit of risk. Altiplano Metals is currently generating about 0.03 per unit of risk. If you would invest 1,045 in Vale SA ADR on September 7, 2025 and sell it today you would earn a total of 245.00 from holding Vale SA ADR or generate 23.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vale SA ADR vs. Altiplano Metals
Performance |
| Timeline |
| Vale SA ADR |
| Altiplano Metals |
Vale SA and Altiplano Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vale SA and Altiplano Metals
The main advantage of trading using opposite Vale SA and Altiplano Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vale SA position performs unexpectedly, Altiplano 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 Altiplano Metals will offset losses from the drop in Altiplano Metals' long position.| Vale SA vs. Mount Gibson Iron | Vale SA vs. Strainsforpains | Vale SA vs. Olympic Steel | Vale SA vs. Broadstone Net Lease |
| Altiplano Metals vs. Lend Lease Group | Altiplano Metals vs. Vienna Insurance Group | Altiplano Metals vs. Slide Insurance Holdings, | Altiplano Metals vs. The Hanover Insurance |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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